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I 


CIRCULAR.   I 


New-Yokk,  Fehruftnj  1st,  IsfiO, 
To  the  Insurance  Agents  of  the  United  States: 


Gentlemen  —  You  have  probably  heard  soniethiiiu  oi 
a  movement  that  has  been  inaugurated  to  procure  from 
cress  a  "National  Insurance  Law."     It  is  to  advist' 


you,  somewhat  m  detail,  concernmg  tins  project — m  which 
you,  as  Agents,  are  vitally  interested,  that  this  circular 
and  the  accompanying  pamphlet  have  been  prepared. 

The  plan  is  prompted  mainly  by  three  considerations  : 
its  Necessity,  its  Desirableness,  its  E(piity. 

I.  Its  Necessity. — Legislation  in  the  several  states 
towards  the  Insurance  Companies  of  sister  states,  has 
proceeded  hi  a  spirit  of  persistent  and  injurious  liostility, 
until  it  has  created  an  almost  prohibitory  burden  of 
taxes,  forced  loans,  deposits,  licences,  subsidies,  compul- 
sory advertising,  fees,  &c.,  «&c.,  State,  County  and  Muni- 
cipal, that  would  surpass  the  belief  of  one  not  fannliar 
therewith.  Generally,  these  laws  do  not  look  to  the  real 
security  of  the  policy  holder,  or  the  strength  of  tiie 
companies,  but  are  apparently  conceived  in  a  temper  of 
extortion  and  unfriendliness  to  enterprises  that  are  the 
handmaids  of  conmierce  and  the  guardians  of  all  <nir 
destructible  values.  For  example  :  the  one  item  of  com- 
pulsory newspaper  printing  in  the  one  State  of  Ohio 
alone  amounts  to  over  S:2r),00()  each  year,  not  one  copper 
of  which  is  necessary  to  the  safety  ot  the  insured. 

But  to  begin  nearer  home.  No  company,  domestic  or 
"foreign",  can  do  business  in  New^-York  without  respond- 
ing annually  to  a  catechism  of  ninety-eight  questions, 
spread  over  six  broad  jiages  of  super-royal  paper,  which 
run  the  chromatic  scale  of  subtile  inquisition  with  most 
scrutinizing  curiosity  !  In  so  far  as  this  conduces  to  the 
suppression  of  unworthy  institutions  and  the  encourage- 
ment of  solid  ones,  no  good  company  does  or  will  object 


From  Ths  Insurance  Librar:  Association  oi   boston 


■  must  be  accorded  to  the  Insurance 
.    Departments  of  New- York  and    Massachusetts  for  the 
salutary  effect  they  have  had  upon  the  companies  of  the 
'  land.     In  Life  Insurance,  however,  a  deposit  of  $100,000 
is  required,  to  be  made  in  the  New-York   Department 
j   (or  that  of  some  other  State),  and  this  feature  is  com- 
plained of  bitterly  by  Western  Life  and  Accident  Com- 
panies who  will  not  make  the  deposit  here,  who  have  no 
Department  at  home  with  which  to  make  it,  and  yet 
whose  means  are  ample,  and   whose  record  creditable  ; 
and  it  is  used  as  a  telling  plea  for  retaliatory  measures  in 
their  several  states. 

In  Pennsylvania,  each  "foreign"  Company  must  pay 
an  annual  State  license  of  $600,  and  appoint  a  State 
Agent  to  whom  all  other  Agents  in  that  State  must  report 
the  amount  of  their  premiums,  on  which  he  must  pay  a 
tax  of  three  per  cent. 

In  Virginia  they  have  in  contemplation,  as  I  have  been 
recently  advised,  a  law  requiring  a  deposit  of  $50,000 
from  all  ''foreign"   Companies. 

In  Alabama,  each  agency  of  each  "  foreign"  Company 
must  make  a  forced  donation  of  $200  annually  to  the 
Fire  Department  of  the  town  in  which  such  Agency  is 
located,  and  in  Mobile  an  additional  $200  to  the  Medical 
College  ! 

In  Louisiana  there  is  a  State  Tax  of  $1000,  and  in  New 
Orleans  an  additional  City  Tax  of  $2,000,  and  a  certain 
per  centage  of  premiums  go  to  the  Bonds  of  the  Opelousas 
Railroad  ! 

In  Tennessee,  a  deposit  of  $20,000  is  required  as  a  pre- 
requisite to  the  first  policy,  an  annual  fee  of  $1,250  to  the 
State  Auditor  in  addition  to  his  little  perquisites  for  issu- 
ing papers,  &c.,  and  the  county  and  municipal  taxation  is 
such  that  it  costs  $1,500  entrance  money  per  annum  at 
Nashville  and  about  the  same  at  Memphis  to  plant 
Agencies  in  those  cities. 

Arkansas  has  made  a  fliint  copy  of  the  Wisconsin 
swindle,  in  a  requirement  for  each  Company  to  purchase 


and  deposit  with  lier  own  State  officials,  So,00()  of  her 
own  Bonds.  One  Conii)any  recently  applied  for  the 
Bonds  and  was  told  by  the  Honorable  State  Auditor  that 
they  had  no  Bonds  yet,  and,  worse,  they  had  no  money  to 


California   requires    a    deposit    of    $7.5,000    (in    gold). 

Missouri  has  a  sliding-scale  license  arrangement  of  840 
to  SlOO  per  county. 

Wisconsin  demands  a  deposit  of  S'),000  and  upwards, 
according  to  premium  receipts,  to  be  made  in  her  own 
Bonds,  and  the  deposit  to  be  increased  from  year  to  year. 

Iowa  and  Ohio  require  a  deposit  of  5  per  cent,  of  all 
State  premiums  received,  if  deposits  are  made  in  any 
other  States. 

One  word  here  in  regard  to  deposits.  Each  State  that 
adopts  tlie  plan,  renders  it  the  more  urgently  necessary 
that  each  other  State  should  do  the  same.  One  State 
cannot  quietly  see  $^30,000  or  $100,000  of  the  assets  of  a 
Company  doing  business  among  her  citizens,  detached  for 
the  exclusive  security  of  a  "foreign"  State  without 
demanding  similar  security  for  her  own  people,  and  she 
must  have  as  large  a  deposit  too.  Of  necessity  and  in  self- 
defence  each  State  must  legislate  this  matter  as  severely 
as  any  other  State  ;  and  from  the  movements  now  contem- 
plated and  threatened,  I  do  not  see  where  local  legislation 
can  consistently  stop,  short  of  a  maxinmm  deposit  in  each 
State  of,  say  $100,000.  Let  this  become  general,  (as  it  must 
if  it  continues,)  and  it  will  take  over  three  millions  to  go 
around.  Compliance  is  sim])ly  impossible.  Such  legisla- 
tion is  prohibitory,  and  this  is  precisely  w  hat  local  monoj)- 
olists  covet ;  and  monopoly,  or  a  desire  for  it,  is,  after  all, 
at  the  root  of  these  adverse  measures. 

To  resume.  All  these  States,  and  most  of  the  others, 
require  annual  or  semi-annual  statements,  of  greater  or 
less  length  and  complexity,  and  all  levy  taxes  on  the 
premiums  received  ;  some  two,  some  three,  some  five  per 
cent. — not  on  the  profits  alone,  but  on  the  losses  and 
expenses  as  well,  they  tax  "gross  sales!"     Some  require 


aavertisiiig  at  each  agency,  an 
indiscriminate  requisition  for  the  smallest  village  and 
the  largest  city  alike;  and- all  these  onerous  burdens  are 
laid  on  Companies  from  '^  other  States,"  while  home 
institutions  are,  as  a  rule,  without  any  wholesome  check 
or  regulation  whatever. 

These  are  samples  of  the  uufriendly  impediments  laid 
m  the  way  of  legitimate  enterprise  by  State  legislation. 
No  other  branch  of  national  enterprise  is  so  harassed. 
Manufocturmg  Conipanies,  Express  Companies,  Telegraph 
Companies  ;  Scholastic,  Religious  and  Publication  Compa- 

mes,andscoresofothercorporateenterprisesprosecute  their 
business,  through  the  medium  of  agencies,  in  all  the  States 
without  let  or  hindrance,  and  they  have  a  perfect  right  to 
do  so.  The  clogs  placed  upon  Insurance  Companies,  who 
wish  to  do  the  same  thing,  are  wholly  inexcusable  ;  they 
are  without  precedent  or  justification  ,•  their  tendencies 
are  evil  and  only  evil ;  they  impose  burdens  and  restric- 
tions upon  the  citizens  and  the  trade  of  sister  States  that 
they  impose  not  upon  their  own,  and  thereby  violate  the 
spirit  of  that  broad  and  beneficent  provision  of  the  Con- 
stitution which  says,  "  The  Citizens  of  each  State  shall  he 
entitled  to  all  Privileges  and  Lnmmiities  of  Citizens  in  the 
several  States,'' 

Such  legislation  is  in  violent  discord  with  a  loyal, 
national  spirit,  is  productive  of  prejudice  and  full  of 
useless  opposition  to  the  legitimate  enterprises  of  the 
several  States.  Such  legislation  tends  to  establish 
monopoly,  cripple  trade,  promote  inconvenience,  increase 
the  rates  of  Insurance,  encourage  laxity  in  local  Com- 
panies, destroy  the  incomes  of  thousands  of  agents, 
quench  competition,  substitute  favoritism  for  merit,  and 
to  force  upon  the  people  against  their  desires  a  poorer 
article  at  a  higher  price  and  more  difficult  to  obtain. 

No  relief  need  be  expected  from  the  States  themselves ; 
on  the  contrary,  the  disposition  is  increasing  to  add  to  the 
absurdities  and  injustice  already  existing.  Hardly  a  week 
passes,  but  some  new  municipal  license  or  State  deposit 


is  broaclied.  The  newest  sensation  is  an  ordinance  now- 
pending  before  the  city  authorities  of  Chicago,  to  impose 
upon  Insurance  Companies  from^  other  States  an  annual 
city  license  of  $-300  !        fl^plH 

The  necessity,  then,  for  some  central  bureau  that  sliail 
regulate  this  whole  matter,  produce  uniformity,  and  at 
once  protect  both  insurer  and  insured,  is  apparent.  Such 
regulation  can  come  from  the  National  Government  only, 
and  to  Congress  we  must  look  for  the  needed  relief. 

II.  Its  Desirableness.— This  is  best  set  forth  by  the 
facts  above  stated,  which  demonstrate  the  necessity  for 
such  a  measure.  The  present  status  being  evil,  relief  is  cer- 
tainly desirable  ;  uniformity  is  desirable,  thoroughness  is 
desirable,  broad  publicity  to  the  conditions  of  Companies 
is  desirable.  The  best  talent  for  the  management  of  an 
Insurance  department  is  desiral)le.  The  greatest  power 
for  demanding  and  compelling  true  and  full  exhibits 
from  Companies  is  desirable.  The  highest  seal  upon  the 
Companies  examined  and  found  worthy  is  desirable.  The 
fullest  measure  of  confidence  that  can  be  inspired  for  such 
worthy  (Companies  is  desirable.  Even  justice  for  all 
Companies,  from  every  section,  is  eminently  desirable.  No 
where  aiul  no  how  can  these  de^*irable  ends  be  so  certainly, 
so  easily,  so  simply,  so  cheaply  reached  as  through  a 
National  BurcMu  of  Insurance,  authorizi'd,  watched,  pro- 
tected and  fostered  by  the  United  States  Uovernment. 

III.  Its  IvniTY.— The  plan  proposed  embraces  the 
whole  Union,  with  eveiy  Company  therein  that  may 
choose  to  avail  itself  of  its  benefits.  It  is  not  lor  the 
advantage  of  any  one  section  or  set  over  another,  but  tor 
all  alike ;  the  most  obscure  Company  in  the  centre  of 
any  Western  State  that  wishes  to  join  in  securing  the 
rich  harvest  among  the  heavy  values  of  the  Eastern  Cities 
is  embraced  in  its  provisions,  and  may  profit  equally  with 
the  most  powerful  Eastern  corporations,  if  it  elects  to  con- 
form to  its  requirements. 

It  is  not  the  de«iuu  to  ask  for  a  law  to  regulate  the 
Companies    of  any  State    within    that    State,   Congress 


could  not  enacr  siicli.  But,  under  its  special  grants  of 
power  to  r(^gulate  trade  between  the  States  and  promote 
the  general  welfare,  it  can  dictate  the  terms  on  which 
Companies  may  carry  on  an  inter-state  business. 

It  is  not  the  design  to  ask,  nor  would  it  be  the  pro- 
vince of  Congress  to  grant  a  law  to  which  compulsory 
obedience  must  be  made,  but  to  provide  a  statute  that 
will  protect  the  rights  of  all  parties,  and  let  those  com- 
panies comply  that  choose. 

The  effect  of  such  an  arrangement  must  be  most  bene- 
ficial. Enterprise  from  any  quarter  would  be  encouraged 
by  it.  Capital  would  be  protected  by  it.  Monopoly 
w^ould  be  checked,  favoritism  restrained,  injustice  put  to 
shame  and  many  evils  quenched. 

What  are  the  best  means  for  obtaining  the  desired  end  ? 
This  question  has  exercised  the  minds  of  some  of  the 
ablest  men  in  our  profession,  and  is  not  yet  fully  an- 
swered. On  the  first  of  November  last,  a  convention  of 
fifty-one  Companies  met  in  this  city,  and,  after  much 
earnest  conference,  appointed  a  committee  of  thirteen,  to 
whom  was  confided  the  duty  of  preparing  a  bill  which 
they  should  present  to  Congress.  They  were  also  to  solicit 
your  aid  in  behalf  of  the  measure,  and  to  take  such  other 
steps  as  would  be  most  likely  to  secure  the  object  sought. 
Subsequently,  the  Life  and  Accident  Companies  met  also, 
and  appointed  a  committee  of  eight,  to  work  in  harmony 
with  the  committee  of  thirteen. 

The  bill  is  now  in  course  of  preparation,  and  will  be 
laid  before  Congress  at  the  earliest  practicable  day. 

Among  the   resolutions  passed  at  that  Convention  was 
the  folio  win  Of : 


Resolved,  That  the  members  of  this  Convention,  and  all  others  interested 
in  the  business  of  Insurance,  be  requested  to  use  earnest  and  active  efforts 
to  prepare  the  niinds  of  the  .Senators  and  Representatives  of  their  r.'spective 
States  to  receive  with  favor  some  plan  of  nationalizing  the  business  of 
Insurance. 


What  can  you  do  as  an  Agent  to  forward  this  work? 
I  suggest  the  following  plan  of  operations ;  it  can  be 
modified  to  meet  the  necessities  of  various  localities,  but 


will  serve  as   a  l)asis   lor 


11  throiiirhdnt  the 


countrv. 


] .  Let  all  the  Agents  in  your  Congressional  District 
meet  at  some  central  and  convenient  point  to  deliberate 
upon  this  matter.  Concert  of  action  is  vital,  and  this 
cannot  well  be  attained  without  conference  and  a  mutual 
understanding. 

•?.  Memorials  should  be  circulated  among  your  business 
men  for  signatures,  petitioning  Congress  for  a  general 
Insurance  Law.     Forms  for  these  will  be  furnished. 

;3.  If  you  are  personally  and  hiflueutially  acquainted 
with  your  member,  write  him  on  this  subject,  urging  his 
favorable  action  on  such  a  measure  when  it  comes  up ;  if 
you  are  not  so  acquainted,  secure  at  once  letters  from  some 
of  his  strongest  friends,  and  have  these  points  put  in  such 
shape  and  with  such  force  as  will  arrest  his  attention. 
This  step  I  regard  as  of  the  first  importance. 

Among  the  points  on  which  you  should  post  your  Con- 
gressman, are  : 

1.  The  number  of  Agents  in  his  district. 

2.  The  value  to  them  of  their  Agencies. 

;i.  The  loss  that  would  ensue  should  they  be  deprived 
of  them.  (Bear  in  mind  always  that  the  aim  and  tendency 
of  oppressive  local  legislation  is  to  wipe  out  the  present 
efficient  and  valuable  system  of  Agencies,  and  substitute 
for  it  local  Companies ;  Home  insurance.) 

I.  The  character  and  real  merits  of  the  local  Compa- 
nies, the  home  institutions  and  the  Mutual  Wild  Cats  sei'k- 
ing  business  in  his  district  ;  tell  him  of  their  practices,  give 
him  their  history,  advise  him  of  the  real  estimate  in 
which  they  are  held  by  the  best  and  the  best  posted  men. 
Oive  him  the  real  bearings  of  the  business,  and  the  true 
mciits  of  the  best  Companies  as  compared  with  the  ones 
favored  by  this  local  legislation. 

-5.  Remind  him  that  his  own  property  or  his  life  is  in- 
sured in  some  Company.  Ask  him  to  apply  the  matter 
to  his  own  case,  and  bv  what  he  wants  himself,  he   can 


none  too  good  for  him— the  best  is  none  too  good  for  all. 
If  he  would  like  the  additional  safety  that  will  be  secured 
by  the  proposed  measure,  if  he  would  enjoy  the  guarantee 
of  the  National  Insignia,  if  he  prefers  Greenbacks  to 
ordinary  currency,  he  may  be  sure  his  people  would  like 
the  same. 

6.  This  movement  is  really  a  personal  matter  to  him,  to 
you,  to  us  all.  There  will  be  corporations  that  favor  it 
and  corporations  that  oppose ;  there  will  be  motives 
good,  bad  and  mixed,  for  and  against  it,  but  the  real  gist 
of  the  matter  is  one  that  persofially  concerns  every  citizen 
of  the  United  States  who  holds,  or,  ever  expects  to  hold 
an  Insurance  Policy— Fire,  Marine  or  Life. 

Allow  me  to  urge  upon  you  the  great  iniportan<-e  of 
prompt  and  efficient  attention  to  this  matter  ;  it  cannot 
fail  to  commend  itself  to  your  good  judgment.  Let  it, 
then,  command  your  time  and  effort.  Unanimity  of  action 
will  insure  success,  and  success  will  he  worth  all  it  can 
cost  and  a  thousand  times  more. 

What  shall  you  do  ? 

1.  At  once  bring  to  bear  upon  your  Congressman  all  the 
light,  all  the  influence,  all  the  weight,  all  the  constraining 
and  quickening  poWer  at  your  command.  If  you  cannot 
reach  him  eftectually  yourself  set  some  one  in  motion  who 
can,  and  do  not  rest  contentf'd   with  a  promise,  but  see 

THAT  IT  IS  DONE. 

2.  Attend  the  meeting  that  will  shortly  be  called  in 
your  congressional  district  by  all  means.  Go  resolved  to 
act  and  you  will  return  well  posted  and  enlightened. 

3.  Diligently  circulate  the  memorials  among  your 
leading  and  influential  men,  and  forward  them  to  your 
member  without  delay. 

4.  Do  not  rely  alone  upon  these  suggestions  for  ways 
and  means  ;  the  subject  is  not  only  not  exhausted,  but 
hardly  touched.  Ample  field  is  open  for  thr  exercise  of 
your  own  independent  powers. 

C.  C.  HINE, 

Sec.  of  Com.  of  13. 


that  will  shortly  be  called  in 
by  all  means.     Go  resolved  to 
11  i>osted  and  enlightened, 
the    memorials    amonc:    your 


,  and   forward 


m   to  vour 


COMMITTEE   OF   THIRTEEN, 

Appointed  hy  the  Convention  of  November  1,   1805. 


(JK()I{(JK  T.  HOPK.... 

C.  ('.  niNE 

DOHAS  L.  STONK 

EDWI).  li.    SMITH.... 

TIMO  ('.  AI.LYN 

F.  CHAMIJKKLAIX  ... 
I).  U.  SATTHHLKE.... 

.1.  N.  nrxiiAM 

KDMINI)    FKEKMAN 
JOHN  KIN(;SIUIKY.. 

J.  S.  PAKISH 

A.  (J.  COFFIX 


. Secretary  Infemafional 

.  President  Hanover . 

,  Secretary  Wcxtrrn 

.  President  Hartford , 

.  Director  PhiEui.r 

.  President  Home 

.Secretary  Western  MasHachmettg . 
.President  Sprin<r field  Fire  cS-  Mari} 
.President  Proridence    Washini 

. Secretary  Atlantic 

. President  Xortk  Amerira 


.New-York, 
.liutfalo. 


J  NO.  H.SKIDENSTUKKEU,  President  National  F 


COMMII'TEE  OF   EIGHT, 

Appointid  hij  the  Life  Companies,  December  13,  1865. 


(;iTY  K.  PHELPS... 
SHEPPARl)  IIOMAX! 

N.  1).    MOKCAN 

HENKY  STOKES.... 

B.  F.    STEVENS 

SAME   H.    WHITE.. 
AMZI    IX  UH) 

C.  VV.  HorCK 


.Secretary  Connecticut   Mutual Hartford. 

.Actuary  Mufunl  Life New-Yot 

.President  Sort.h  America  Life N'ew-York. 

.  President  Manhattan    Life New-York. 

,  President  Scir  England  Mntual  Life,  Bostoi 

Secretary  C//''/r//r  Oak  Life Hartford. 

.  Mathematician  Muhial  Benefit  Life. .  Ne\ 

. President  Brookr,,n  Life Brooklyn. 


LIST   OF   COMPANIES   THAT   HAVE    FILED   ASSENT  TO 
THE    KESULUTIONS   OF   CONVENTION. 


REPUBLIC 

WASHINtJTOX 

MOKKIS 

AIU'TIC 

HONVAUI) 


ASTOH 

NIAGAUA   FittE 
SECURITY 


.New- York. 
New-York. 
.New -York. 
.  New-York. 
.New-Y<.rk. 
.New  York. 
.New- York. 
.New- York. 
.New-York. 
.New- York. 
.New  York. 
.New  York. 
.NrwY(»rk. 
.New  York. 
.New- York. 
.N<'W-York. 


ANDN.Y.. New  York. 
AN New- York. 


KNICKERBOCKER 
LIFE 

NORTH    AMERICA 
LIFE 


ALBANY    ( 
SPinN(;Fll": 


AU1NE....M 
>LVSSACHr 


^ETNA Har 

HARTFORD Hari....... 

PHCENIX Hartford. 

PUTN  A.M Hartfonl. 

MERCHANTS' Hartford. 

CITY  FIRE Hartford. 

NEW  ENOL.VND Hartford. 

NORTH  AMERICAN.  .Hartford. 
CONNECTKUr  FIRE,Hartfor<i. 
CHARTER  OAK  LIFE,  Hartfonl. 
PIKENIX     MUTUAL 

LIFE Hartford. 


TUAL  I 
TR  AVE  LEI. 
PIIENIX  .. 

HOME 

NORWICH 


LANTIC. 
ERICAN 


Brooklyn. 
New  Have 


.Norwich. 
. Providen* 


.Providenc( 
ProvideniM 


liN  TRANSIT,  St.  Loui 


SURANCE\ 
N   W    MUTUAL 


The  object  of  the  succeeding  pages  is  to  lumisn  snch 
material  as  has  been  collated,  touching  the  subject  of  In- 
surance Legislation.  To  show  the  feasibility  and  the 
constitutionality  of  National  Insurance.  To  give  the 
views,  so  far  as  they  have  been  obtained,  of  statesmen 
bearing  upon  this  important  topic,  and  to  supply  facts  for 
use  as  they  may  be  needed. 

Ko  uiore  fitting  opening  could  be   devised  than    the 
lol  lowing 

I  Evtractfrom  President  Johnson's  Message,  Dec.  o,  JStio. 

monopolip:s. 

Our  government  springs  from  and  was  made  for  the  people- 
people  for  the  government.  To  them  it  owes  allegiance ;  from  then.  i7mZ 
denve  Its  courage  strength  and  wisdom.  But  while  the  government  is 
thus  bound  to  defer  to  the  people,  from  whom  it  derives  its  existence,  it 
should,  from  the  very  consideration  of  its  origin,  be  strong  in  its  power  of 
resistance  to  the  establishment  of  inequalities.     Monopolies,  perpetuiti^^ 

Id  class  Legislation  are  contrary  to  the  genius  of  free  government, 
ought  not  to  be  allowed.  Here,  there  is  no  room  for  favored  classes' or 
monopolies ;  the  principle  of  our  government  is  that  of  equal  laws  and  free- 
I  01  industry.  Wherever  monopoly  attains  a  foothold,  it  is  sure  to  be  a 
source  of  danger,  discord  and  trouble.  We  shall  but  fulliH  our  duties  as 
legisators  by  according  -  equal  and  exact  justice  to  all  men,"  speci- 
privileges  to  none.  The  government  is  subordinate  to  the  people;  b 
the  agent  and  representative  of  the  people,  it  must  be  held  superior  to 
monopolies,  which,  in  themselves,  ought  never  to  be  granted,  and  which, 
where  they  exist,  must  be  subordinate  and  yield  to  the  govei 

TRADE    BETWEEN   THE   STATES. 

The  constitution  confers  on  Congress  the  right  to  regulate  commerce 
among  the  several  States.  It  is  of  the  first  necessity,  for  the  maintei 
of  the  Union,  that  that  commerce  should  be  free  and  unobstructed.  No 
State  can  be  justified  in  any  device  to  tax  the  transit  of  travel  and 
commerce  between  States.  The  jMsiticn  of  many  States  is  such  that, 
Jf  they  were  allowed  to  take  advantage  of  it  for  purposes  of  local  revenue^ 
the  commerce  between  States  might  be  injuriously  burdened,  or  even 
virtually  prohibited.  It  is  best,  while  the  country  is  still  young,  and  while 
the  tendency  to  dangerous  monopolies  of  this  kind  is  still  fe 
l>ower  of  Congress  so  as  to  prevent  any  selfish  impediment  to  the  free 
circulation  of  men  and  merchandise.  A  tax  on  travel  and  merchandise,  in 
their  transit,  constitutes  one  of  the  worst  forms  of  monopoly,  and  the 
evil  is  increased  if  coupled  with  a  denial  of  the  choice  of  route.  When 
the  vast  extent  of  our  country  is  considered,  it  is  plain  that  eveiv 
to  the  free  circulation  of  con.merce  between  the  States  ought  to  be  stei 
guarded  against  by  appropriate  legislation,  within  the  limits  of  the  consti- 

fnfinn 


3e  free  an( 


for  the  maintei 

1  unobstructed.    N< 


12",  and  while 


Monopoly  is  the  essence  of  the  objectionable  State 
Legislation.  To  grant  to  a  class  "  special  privileges " 
[class  legislation]  denied  to  all,  is  the  very  pith  of  the 
matter.  Taxation  by  one  State  of  the  legitimate  com- 
mercial enterprises  of  other  States  is  the  enormity  from 
which  refuge  is  songht.  If  ^Ir.  Johnson  had  had  the 
great  Insurance  interests  directly  in  view,  he  could  hardly 
have  been  more  to  the  point. 

EXTRACTS  FROM  WEBSTER. 

Remarks  maih  in  the  Senate  of  the  United  States,  on  the  hill  to  authorizt  tlie 
Purchase,  on  the  part  of  the  Govern  nit  nt,  of  the  Private  Stock  in  the  Louis- 
ville and  Portland  Canal,  on  the  '2'jth  of  May,  1836. 

Whoever,  Mr.  I'resident,  would  do  his  duty,  and  his  whole  duty,  in  the 
councils  of  this  government,  must  look  upon  the  country  as  it  is,  in  its 
wliole  length  and  bn?adth.  He  must  comprehend  it  in  its  vast  extent,  its 
novel  character,  its  sudden  development,  its  amazing  progress,  confounding 
all  calculation,  and  almost  overwhelming  the  imagination. 

To  be  sure.  Sir,  this  is  a  work  of  internal  improvement ;  but  it  is  not  on 
that  account  either  the  less  constitutional  or  the  less  important.  Sir,  I  have 
taken  a  part  in  this  great  struggle  for  internal  improvement  from  the  begin- 
ning, and  I  shall  hold  out  to  the  end. 

But,  Sir,  in  this  case,  as  in  others,  the  doctrine  of  internal  improvement 
has  established  itself  by  its  own  necessity,  its  own  ol)viou8  and  confessed 
utility,  and  the  benetits  which  it  has  already  so  widely  conferred.  So  it 
Avill  be,  I  have  no  doubt,  in  the  case  before  us.  We  shall  wonder  hereafter 
who  could  doubt  the  propriety  of  setting  free  the  navigation  of  the  Ohio, 
and  shall  wonder  that  it  was  delayed  even  so  long. 

We  have  foreign  commerce,  and  we  have  intenial  commerce  ;  and  the 
power,  and  the  duty  also,  of  regulatijig,  protecting,  aiding,  and  fostering 
both,  is  given  in  the  same  words.  For  one,  therefore,  Sir,  1  look  to  the 
magnitude  of  the  object,  and  not  to  its  locality.  I  ask  not  whether  it  be 
east  or  west  of  the  mountains.    Tlu're  are  no  Alleghanies  in  my  politics. 

I  care  not  whether  it  be  an  improvement  on  the  shore  of  the  sea,  or  on 
the  shore  of  one  of  those  mighty  rivers,  so  much  like  a  sea,  which  tlow 
through  our  vast  interior.  It  is  enough  for  me  to  know  that  the  object  is  a 
good  one,  an  important  one,  within  the  scope  of  our  powers,  and  called  for 
bv  the  fair  claims  of  our  commerce. 


Speech  dclirercd  at  Madison,  in  the  State  of  Indiana,  on  the  Ut  of  June,  1KJ7. 

Believing  that  the  great  object  of  the  I'nion  is  to  secure  the  general 
safety  and  promote  th«'  general  welfare,  and  that  the  Constitution  was 
designed  to  point  out  the  means  of  accomplishing  these  ends,  I  have 
always  been  in  favor  t»f  such  measures  as  I  deemed  for  the  general  benrlit, 
under  the  restrictions  and  limitations  nn'scrilied  by  the  Constitution  itself. 


I  supported  them  with  my 

the  benefit  of  the  West,  but  because  they  were  for  the  benefit  of  the  wliole 
country.  That  they  are  local  in  their  advantages,  as  well  as  in  their  con- 
struction, is  an  objection  that  has  been  and  will  be  urjred  against  ei 
measure  of  the  kind.  In  a  country  so  widely  extended  as  ours,  so  diversi- 
fied  in  its  interests  and  in  the  character  of  its  people,  it  is  impossible  that 
the  operation  of  any  measure  should  aft'ect  all  alike.  Each  has  its  own 
peculiar  interest,  whose  advancement  it  seeks ;  we  have  tlie  sea  coast,  and 
you  the  noble  river  that  tlows  at  your  feet.     So  it  must  ever-be.     Go  to  the 


smallest  ffovern 


^A    K„f  u„ 


in  the  world,  1 
of  but  ten  mile: 


^u  any  mea 


of  San  Marino,  in  Italv 


"-"  miles,  having  some  interests  which,  on  accou 
"*  ^  "--.tinct.    There  is  not  on  the  face  of  the 

-'ose  inhabitants  are  all  the  same  i 
le  will  live  on  a  creek,  others  near  a  hill, 
"""  "*""  ''^e  general  benefit,  will  giv(     " 
;  imuiesis.     In  such  cases,  it  has  alwaj 
the  point  to  be  examined  was,  whether  the  principle 
principle  were  general,  although  the  application  might 
y  and  zealously  gave  it  my  support. 


Delivered  in  the  Senate  of  the  United  States  on  the  26th  of  January,  1830. 

Sir,  I  do  not  desire  to  enlarge  the  powers  of  the  government  by  unjusti- 
fiable construction,  nor  to  exercise  any  not  within  a  fair  interpretation, 
it  is  believed  that  a  power  does  exist,  then  it  is,  in  my  judgment, 
jeneral  benefit  of  the  whole.  So  far  as  respects  the 
I  power,  the  States  are  one.  It  was  the  very  object  of  the 
Constitution  to  create  unity  of  interests  to  the  extent  of  the  powers  of  the 
general  government.  In  war  and  peace  we  are  one  ;  in  commerce,  one  ; 
because  the  authority  of  the  general  government  reaches  to  war  and  peace, 
and  to  the  regulation  of  commerce.  I  have  never  seen  any  more  difficulty 
in  erecting  lighthouses  on  the  lakes,  than  on  the  ocean  ;  in  improving  the 
harbors  of  inland  seas,  than  if  they  were  within  the  ebb  and  iiow  of  the 
tide ;  or  in  removing  obstructions  in  the  vast  streams  of  the  West,  more 
than  in  any  worlc  to  facilitate  commerce  on  the  Atlantic  coast.  If  there  be 
any  power  for  one,  there  is  power  also  for  the  other  ;  and  they  are  all  and 
equally  for  the  common  good  of  the  country. 


Speech  delivered  in   the   Senate  of  the   United   States  on  the  28th  of  September, 
18:37,  on  the  Currency. 

The  nature  of  exchange.  Sir,  is  well  understood  by  persons  engaged  in 
commerce  ;  but  as  its  operations  are  a  little  out  of  the  sight  of  other  classes 
of  the  community,  although  they  have  all  a  deep  and  permanent  interest  in 
the  subject,  I  may  be  pardoned  for  a  word  or  two  of  general  explanation* 
I  speak  of  domestic  exchanges  only.  We  mean,  then,  by  exchange,  this 
same  transfer  of  funds.  We  mean  the  making  of  payment  in  a  distant 
place,  or  the  receiving  of  payment  from  a  distant  place,  by  some  mode  of 


papfr  credits.  If  done  by  draft,  order,  or  bill  of  exchange,  that  is  one  form ; 
if  done  by  the  transmission  of  bank  notes,  through  the  post  office,  or  other- 
wise, that  is  another  form.  In  each,  credit  is  used;  in  the  first,  the  credit 
of  the  parties  whose  names  are  on  the  bill  or  draft ;  in  the  last,  the  credit  ot 
the  bank.  Every  man,  Sir,  who  looks  over  this  vast  country,  and  conto 
plates  the  commercial  connection  of  its  various  parts,  must  see  the  gre 
in>portanc«.'  that  this  exchange  should  be  cheap  and  easy.  To  the  produc 
and  to  the  consumer,  to  the  manufacturer  and  the  planter,  to  the  merchant. 
to  all,  in  all  classes,  this  is  a  matter  of  moment. 

The  power  over  the  coinage  is  not  the  strongest,  nor  the  broadest,  ground 
on  which  to  i)lace  the  duty  of  Congress.  There  is  anotluT  power  granted 
to  Congress,  which  seems  to  nw  to  apply  to  this  case  directly  and  irresisti- 
bly, and  that  is  the  commercial  power.  The  Constitution  declares  that 
Congress  shall  have  power  to  regulate  commerce,  not  only  with  foreign 
nations,  but  hetircen  the  Stntrs.  Tins  is  a  full  and  complete  ^rant,  and  must 
include  authority  ortr  ertnj  thing  tchirh  is  part  of  commerce,  or  essential  to 
commerce.  And  is  not  money  essential  to  commerce  ?  No  man  in  his  senses 
can  deny  that;  audit  is  e(iually  clear,  that  whatev.T  paper  is  put  forth. 
with  intent  to  circulate  as  currency,  or  to  be  used  as  money,  immediattl  v 
affects  commerce.  Bank  notes,  in  a  strict  and  technical  sense,  arc  U" 
indeed,  money ;  but  in  a  general  sense,  and  often  in  a  l»*gal  8«-ns<',  they  lu*. 
money.  They  are  substantially  money,  b«'cause  they  perform  the  functions 
«>f  money.  They  are  not  like  bills  of  exchange  or  common  pn>uiiss(>ry 
notes,  mere  proofs  or  evidences  of  debt,  but  are  treated  as  mon«'y,  in  the 
g«neral  transactions  of  society.  If  receipts  be  given  for  them,  they  are 
given  as  for  money.  They  pass  under  a  legacy,  or  otlu-r  form  of  gift,  as 
money.  And  this  charact«'r  of  bank  notes  was  as  well  known  and  under- 
stood at  the  time  of  the  adoption  of  tlu;  Constitution  as  it  is  n<»w.  Tlie  law, 
both  of  Kugland  and  AuK-rica,  regarded  them  as  money,  in  the  sense  above 
expressed.  If  Congress,  then,  has  poirer  to  regulate  commerce,  it  must  hare  a 
control  over  that  money,  trhatenr  it  may  be,  by  which  commerce  is  actually 
carried  on.  Uhfther  that  monnj  be  coin  or  paper,  or  however  it  has  acrjuircd 
the  character  of  money  or  currency,  if,  in  fact,  it  has  become  an  actual  aumt  or 
instrument  in  the  performance  of  commercial  transactions,  it  mnssanlif  then  by 
becomes  subject  to  the  regulation  and  control  of  Congress. 


Speech  delivered  in  the  Senate  of  the  I'nited  States  on  the  'JJ«'/  of  Munh,  l-.i-, 
in  Anstrer  to  Mr.  Calhoun. 

IJut,  Sir,  I  liave  insisted  that  government  is  bound  to  protect  and  regu- 
late  the  means  of  con)merce,  to  see  that  there  is  a  sound  currency  for  tl»e  use 
of  the  people.  The  honorable  gentleman  asks,  ^Vhat  then  is  the  limit  f 
Must  Congress  also  furnish  all  m.aus  of  comnurce  ?  Must  it  furnish 
weights  and  scales  and  steelyards  ?  Most  undoubtedly,  Sir,  it  must  regul. 
ate  weights  and  measures,  and  it  does  so.  But  the  answer  to  the  general 
question  is  very  obvious.  Government  must  furnish  all  that  which  none 
but  government  can  furnish.  Government  must  do  that  for  individuals 
which  individuals  cannot  do  for  themselves.  That  is  tlie  very  end  of 
government.     Why  else  have  we  a  government  / 


MAGNITUDE  OF   THE   INSURANCE   BUSINESS  WITHIN 
THE  UNITED  STATES. 

The  following  figures  show  the  operations  of  the  Com- 
panies reporting  to  the  New- York  Insurance  Department 
for  Rve  years. 

JSo  reports  of  Ocean  Marine  Companies  are  included. 
These  vast  amounts  are  from  Fire,  Inland  and  Life  Compa- 
nies only,  and  on  business  done  within  the  United  States  only, 
and  such  portion  oj  those  Companies  as  do  business  in  New 
York  only.  No  statistics  are  accessible  to  show,  in 
addition,  the  immense  transactions,  Fire,  Inland  and 
otherwise,  of  the  other  Companies  located  at  Boston, 
Philadelphia,  Baltimore,  Pittsburgh,  Cincinnati,  Chicago, 
St.  Louis,  New  Orleans,  and  the  other  Cities  of  the  Union. 

Premiums  received  in  5  years,  -  -  -  $124,909,732 
Losses  Paid. 60,786,019 

Amounts  Covered, 12,888,917,333 

An  annual  average  of  over  Two  and  a  half  Billions  of 
value  protected  by  Companies  whose  reports  are  attaina- 
ble ;  which  amount  would  be  enormously  swelled  could 
the  figures  of  the  grand  aggregate  be  had. 

It  seems  incredible  that  interests  of  such  stupendous 
aggregate  magnitude  should  be  the  subjects  of  the  whim, 
prejudice  or  carelessness  of  3G  local  legislative  assemblies, 
having  diverse  notions  and  limited  means  of  knowledge. 
And  it  seems  more  incredible  that  even  such  legislation 
should  so  utterly  fail  to  appreciate  the  importance  of  the 
subject  with  which  it  was  dealing  as  to  devise  such 
burdensome,  ungenerous  and  unwise  measures  as  are 
rehearsed,  in  part,  in  the  foregoing  Circular.  And  it 
would  seem  most  incredible  of  all  that  any  one  should 
doubt  the  National  Character  of  Commercial  transac- 
tions covering  over  Twelve  and  three-quarter  Billions  in  five 
years. 

If  this  be  not  Commerce,  what  is  Commerce  ? 


Extracts  from  the  Reports  of  Hon.  William  Baknes, 
Superintendent  of  the  Insurance  Department  of  the 
State  of  New  York. 

From  the  Report  of  1864. 

The  proposed  passage  by  the  State  of  California  of  an  Act  requiring  all 
Insurance  companies  not  incorporated  under  the  laws  of  that  >itate,  to  niak.' 
a  special  deposit  with  some  citizen,  who  shall  be  approved  by  the  Comp- 
troller, of  the  sumof  $7r>,(HM),  in  I'nited  Stat.^s  or  California  State  stocks,  or 
in  stocks  or  bonds  of  the  City  and  County  of  San  Francisco,  for  the  secur- 
ity of  policy-holders,  as  a  pre-requisite  to  the  transaction  of  any  business  in 
that  State,  has  again  forced  public  attention  to  the  consideration  of  the 
whole  system  of  State  deposits,  as  applicable  to  Insurance  companies  and 
the  business  of  Insurance  between  the  various  States  of  the  I'nion.  No 
apparent  necessity  has  dictated  this  unfriendly  step  on  the  part  of  our 
Pacific  neighbors;  no  recent  frauds  by  Eastern  companies  are  reported, 
nor  any  failure  to  pay  claims  for  losses  when  duly  established  by  the  usual 
proofs,  or  by  litigation  in  the  State  courts  of  California.  Indeed  losses  are 
not  as  closely  scrutinized  and  examined  by  Pacific,  as  by  Atlantic  agencies. 
Less  necessity  for  deposits  now  exists  than  at  any  previous  period,  as  pro- 
bably all  unsound  and  fraudulent  organizations  have  been  dissolved  by 
the  Courts,  and  the  great  mass  of  companies  have  also  largely  increased 
their  capitals  and  reserved  funds.  The  sales  of  California  mining  stocks  in 
this  State  subject  our  citizens  to  greater  chances  of  loss  than  can  result  to 
citizens  of  California  from  any  New  York  Insurance  company  ;  and 
deposit  law,  requiring  all  California  Mining  companies  to  deposit  .f  7r),(MX> 
in  New  York  before  selling  stock,  or  otherwise  oi)erating  within  our  terri- 
tory, would  be  entirely  justifiable,  as  proper  retaliatory  legislation  against 
the  unjust  Insurance  laws  already  enacted  by  her  Legislature. 

The  existing  laws  of  the  States  of  Ohio  and  Iowa  require  a  conditional 
deposit,  and  Tennessee  recpiires  an  absolute  deposit  to  be  made  by  Fire 
Insurance  companies  incoriM>rated  in  other  States. 

The  Act  in  the  State  of  Ohio,  passed  in  the  year  1856,  requires  all  Fire 
Insurance  companies  not  incorporated  by  the  State  of  Ohio,  which  have  on 
deposit  in  any  other  State,  territory,  or  country,  any  portion  of  their  capital 
or  earnings  as  a  guarantee  fund  for  the  exclusive  benefit  or  security  of  per 
sons  insured  therein,  to  deposit  in  Ohio,  in  such  manner  as  the  Audito. 
may  direct,  five  per  cetit.  of  the  premiums  received  in  the  State  during  the 
previous  year,  until  such  deposit  shall  amount  to  the  sum  of  $40,(MM>,  to  be 
held  as  a  guaranty  fund  for  the  benefit  of  policy-holders  in  the  State  ot 
Ohio,  until  all  claims  for  losses  or  premiums  on  risks  unexpired  shall  be 
fully  paid  and  discharged,  or  until  all  deposits  in  other  States  and  conn- 
tries  shall  be  withdrawn.  (See  act  entitled  ^^  An  net  to  regulate  Insurance 
companies  not  incorporated  by  the  State  of  Ohio  ^  Session  Lairs,  18r»(;,/».  /o.) 
In  the  year  18r>8,  the  same  statute  was  passed  by  the  Legislature  of 
Iowa.    (Chap.  12,  Laws  of  lSoS,p.  15.) 

In  the  year  1^60,  the  State  of  Tennessee  enacted  that  all  Insurance  com- 
panies, whether  chartered  by  the  Legislature  of  Tennessee  or  any  otlu^r 
State,  should  deposit  with  the  Comptroller,  as  security  for  risks  taken  by 


citizens  of  that  State,  the  sum  of  $20,000  in  six  nor  P^nf    i.     i      r   . 

The  earliest  law  on  the  s„bjcct  of  State  Insurance  deposits  seems  to  be 
,   the  Act  passed  by  this  State  in  la^I.  (Cha,.  95,)  entitled  ''An  AZnrZtl 

^e t»       iTT',"^  ""'  ■'''""  <=<'«>P--'n!es,  whether  : t- 

the  State  of  New  lork,  or  in  other  States,  or  foreign  cou 

the  busmess  of  Life  Insurance  within  this  State,  were  renuired  to  deno,i°t 

Ce  r^'T'  ""  ^""^  "'  ^'"".O""  in  United  C  s,  New  C 

State,  or  city  stocks,  or  in  bonds  and  mortgages.  This  Act  was  cnlt™„ , 
by  the  then  Comptroller,  Hon.  P„ao  C.  fLLb,  as  "qui  oTsnch  d  p™  U 
T^I^^:T:  r^'  "fPo'-y-l-oW-'  ;»  this  S.ate.  Vee  L.  JXd 
VofsmdAcl.)  The  n.jusUce  to  our  sister  States  of  re(|nirin<r  a  snecial 
depos.t  to  be  made  by  their  Life  Insurance  companies  in  this  state.  or  " 
protection  ot  New  York  policy-holders,  was  soon  demonstrated  to  be  so 
apparent,  that  ,n  about  two  years  the  law  was  repeah.d,  and  the  Inerl" 
L,le  Insuranee  Actof  185arC*«;,.463)was  passed,  which  subs.ifnted  a 

^1 T  \  d  ""VTT"  ™'"''''""'  '"  '^''•°""  "•«  «M«.<'0«  in  this  State  ;i 
all  such  deposits  to  be  made  for  the  common  benefit  of  all  the  policy-holders 
whether  res.dn.g  „,  tins  or  in  any  other  State  of  the  Union. 

The  L.(e  Insurance  Act  of  ISKi,  requiring  a  home  deposit  of  $100  000 
'^lll'lTT'"  Poiir!'""--  undoubtedly  exerted  1  iudicforC 


uenencen.  ■nnuence  on  the  business  of  Life  Insurance  in  the  United  States 
g.v,„g  .t  stabahty  and  character,  and  preventing  the  organifattn  of 
numerous  unsound,  experimental  and  fraudulent  companies,';vhieh  would 
otherwise  have  been  foisted  upon  the  public  in  this  and  other  States 

Deposits  are  evidently  much  more  necessary  in  Life  than  in  Fire  Insur- 
ance, for  the  reason  that  Fire  Insurance  contracts  are  generally  made7or 
only  a  single  year,  while  a  Life  company  most  ordinarily  reieive  for  a 
score  or  more  years  an  income  greatly  exceeding  its  expenditure,  and  its 
maximum  ot  .abilities  is  not  generally  reached  until  after  the  e.™  ation  of 
the  average  life  of  at  least  one  generation.  pir.»iion  ot 

If  the  system  of  State  deposits  by  Insurance  companies  is  ever  to  become 
generally  prevalent  in  the  United  States,  such  deposits  should  never  be 
required  to  be  made  except  in  the  State  where  a  company  is  incorporated 
unless  made  with  the  General  Government  at  Washington,  and  all  deposits 
by  American  companies  should  be  held,  not  for  the  .special  protection  of 
policy-holders  residing  in  any  particular  State,  but  for  the  common  benefit 
of  all  American  policy-holders ;  and  all  deposit  laws  should  be  applicable 
to  home  companies  as  well  as  to  those  of  other  States  of  the  Union. 

The  California  law  requires  a  depo.sit  to  be  made  by  the  companies  oi 
other  States  and  foreign  nation,  only,  and  not  by  California  companies 
thus  actually  classing  the  corporations  of  sister  States  as  "Foreign"  com' 


panics,  organized  by  an  alien  government,  and  not  beicg  ev.n  as  fair  i 
this  respect  as  the  law  of  Tennessee. 

The  Constitution  of  the  Tnited  States  provides  that,— "  The  <itizeks 
OF  EAcii  State  shall  be  entitled  to  all  privile<jes  and  immini- 

TIES  OF  en  I/ENS  IN   THE   SEVERAL  STATES."      {Article   11,  section  '2,  i>ub- 
division  J.) 

This  section  was  a  condensation  of  a  more  ampUHed  provision  to  the 
same  effect,  contained  in  the  old  Articles  of  Confederation  and  perpetr^' 
union  (Art.  4.),  which  was  expressly  designed  for  the  purpose  of  bet... 
securing  and  perpetuating  mutual  friendship  and  intercourse  amon.cr  tl... 
people  of  the  ditierent  States.  Upon  declaring  their  independence  of  ^ 
Britain,  the  several  Colonies  suddenly  found  themselves  separate  and  ii 
pendent  sovereignties,  with  all  the  rights  and  privileges  of  independent 
nations,  subject  to  the  contingency  of  establishing  their  freedom  by  the 
chances  of  war.  The  absolute  need  for  combined  action  was,  however,^so 
apparent  that  the  old  Articles  of  Confederation  were  agreed  upon  in  1777, 
the  next  year  succeeding  the  Declarati.)n  of  Independence.  The  Fourth 
Article  was  evidently  a  modification  of  the  usual  clause,  granting  the  same 
privileges  as  to  the  most  favored  nation  contained  in  Treaties  of  amity, 
commerce  and  navigation  between  foreign  nations,  and  also  of  the  ordinary 
article  as  to  the  rights  and  privileges  of  the  citizens  or  subjects  ot  one  coun- 
try in  the  territory  or  dominions  of  the  other.  {See  Elliott's  American 
Diplomatic  Code,  lots,  land  If,  passim  ;  Treaty  tcith  Crcat  Britain,  Vol.  I, 
p.  243,  art.  :i;  Siodcn  and  Nortcay,  id.  '2i\i^,  Art.  1  ;  France,  id.  90,  91 ;  The 
Netherlands,  id.  VM\;  Prussia,  id.  SM,  :m.  Arts.  2,  3;  Denmark,  id.  44^, 
Art.  2.) 

By  a  recent  'I're^itv  between  Great  Britain  and  Belgium,  this  provision 
has  been  so  extended  that  the  high  contracting  parties  mutually  JTiant  to 
all  "  co.npanies  and  associations— connnercial,  industrial  and  Imaneial, 
constituted  and  authorized  in  conformity  with  the  laws  in  force  m  eitiier 
of  the  two  countries,  the  pow.-r  of  exercising  all  their  rights,  and  ot  appea 
ing  before  the  tribunals  throughout  the  dominions  and  possessions  ot  the 
other  power,  subject  only  to  the  condition  of  conforming  to  the  laws  ot  such 
dominions  and  possessions.  (Xew  Yorlc  Instance  Ii, port,  iSGS,  page  MS.) 
It  is  reported  that  a  similar  Convention  has  been  concluded  between  Irauce 
and  Great  liritaln,  nations  which  are  natural  enemies  by  the  traditions 
habits  of  centuries. 

Eminent  counsel  have  given  professional  Opinions  that  under  Art.  4, 
Sec.  2,  of  the  Constitution  of  the  United  States,  one  State  ot  the  I  nion 
cannot  impose  any  taxes,  restrictions  or  burthens  on  the  Insurance  corpora- 
tions of  sister  States,  which  are  not  also  e«iually  imposed  on  the  home  or 
domestic  companies  of  such  State,  and  that  the  fundamental  and  supreme 
law  of  the  land  providing  that  the  citizens  of  each  State  shall  be  entitled  to 
all  privil.«ges  and  immunities  of  citizens  in  the  several  States,  is  ai.plicable 
as  well  to  corporations  or  artiHcial  persons  as  to  citizens  or  natural  p.-rsons. 
(See  Opinions  of  DANIEL  WEBSTER,  GEORCiE  Woov,  and  Chiet  Justice 
Samuel  Jones,  and  of  Wilijam  Curtis  Noves,  arguendo,  3  /:.  D.  Smith 
Eeports.  N.  Y.  Common  Pleas.  4r)8— 48<).) 


•en  France 


ess  and   souudness  of  these  Opinions.     {The  t ire  Department  xs.  ISoble, 
ime  vs.  Wright,  id.,  p.  453  ;  People  vs.  Imlay, 
20  Barh.  Sup.  Court  Rep.,  68;  Bard  vs.  Poole,  12  N.  Y.  (2  Kern.)  Rep.  4%, 
504  ;   Tatem  vs.  Wright,  3  Zabr.  Rep.,  \'cw  Jersey,  429.) 

lose  of  suing  and  being  sued  in  the  United  States  Courts, 
Jate  corporation  is  considered  as  an  artificial  person  and  citizen  of  the 
State  in  ^vhich  it  was  created— per  Wayne,  J.,  in  Louisrille  Railroad  Com- 
pany vs.  Lctson,  2  How.  Rep.  Sup.  Court  United  States,  555,  558. 

Whatever  decisions  may  have  been,  or  will  hereafter  be  made  on  these 
points,  either  in  the  State  or  the  United  States  courts,  it  is  incontrovertible 
that  for  tlie  purposes  of  strengthening  our  inter-state  relations  and  subsei 
ing  the  best  interests  of  the  American  people,  no  invidious  or  unfair  dis- 
crimination should  ever  be  made  by  any  State  against  the  free  and  unre- 
stricted transaction  of  business  within  its  limits  by  the  corporations  of 

3ter  States,  subject  only  to  the  same  rules  and  regulations,  as  near  as  may 
e  applied  to  domestic  companies. 

Hamilton  says,  that  "  It  may  be  esteemed  the  basis  of  the  Union  that 
the  citizens  of  each  State  shall  be  entitled  to  all  the  privileges  and  immuni- 
ties of  citizens  of  the  several  States."     (Federalist,  No.  Ixxx.) 

Denio,  Ch  J.,  says,  that  "No  provision  in  that  instrument  has  so  strongly 
tended  to' constitute  the  citizens  of  the  United  States  one  people  as  this." 
{Lemmon  vs.  People,  20  N.  Y.  Rep.  p.  607.) 

.  violation  of  the  letter  only,  of  this  Article,  which  is  obnoxious 

le  patriotism  and  American  nationality.;  its  pervading  spirit  and  object 

should  inspire  reverence  and  sacred  regard  in  all  our  inter-state  relations. 

Says  Marshall,  Ch.  J.,  "  A  Constitution  from  its  nature  deals  in  gener- 
als,'uot  in  detail.  Its  framers  cannot  perceive  minute  distinctions,  which 
arise  in  the  progress  of  the  nation,  and   therefore  confine  it  to  broad  and 

general  principles."    (Bank  of  the  United  States  vs.  Devaux  et  al.,  5  Crunch. 

It  is  possible  that  under  the  power  to  regulate  Commerce  among  the 
;tates  (see  Art.  1,  sec.  8,  sub.  3),  the  right  inheres  in  Congress  to 
prescribe  rules  and  regulations  for  the  governance  of  inter-state  corporate 
eby  ensuring  a  unilbrm  and  harmonious  system  in  lieu 
t  dissimilar  requirements  of  the  ditferent  States.     If  such 
latent  power  exists,  the  potential  exercise  of  it  will  undoubtedly  be  held  in 
as  the  several  States,  in  a  true  spirit  of  honorable  and 
ternal  intercourse,  refuse   to    impose  prohibitory  burthens    on    their 
ant  them  substantially  the  same  rights,  privileges  and 
tnities  bestowed  upon  their  own  corporations.    The  inherent  justice 
I  equity  of  this  policy  is  sanctioned  by  the  express  provisions  of  our 
Constitution  as  applicable  to  the  citizens  of  each  State,  while  the  necessity 
dino-  the  same  rule  to  corporations  is  daily  increasing,  and  with  a 
restored  an°d  homogeneous  Union  of  freemen  will  be  more  desirable  m  the 
future,  than  in  any  former  period  of  our  history.    The  States  should  cer- 


tainly  jrrant  to  each  other  tlie  same  privilcfjes  which  the  advancing  civiliza- 
tion of  the  acre  induces  Great  Britain  and  other  foreign  nations  to  give  to 
each  other  by  Treaty  stipulations. 

The  States  are  inliibitcd  by  the  Constitution  from  making  any  Treaty, 
alliance  or  confederation,  and  also  from  entering  into  any  agreement  or 
compact,  with  another  State,  without  the  consent  of  Congress.  {See  Art.  1, 
sec.  10.)  Unless,  liowever,  the  legislation  of  the  various  States  can  be 
made  to  liarmonize  on  a  sound  and  just  basis  of  reciprocity  and  lair  deal- 
ing, compacts  or  conventions  l)etwe.'n  assenting  States  can  be  n.-gotiatcd 
on  this  subject  with  the  consent  of  Congress.  Such  a  proceeding" would, 
however,  be  undesirable,  and  miglit  be  more  troublesome  and  unsatisfoctory 
than  a  direct  effort  to  procure  an  amendment  of  the  Constitution,  niakinj 
the  first  subdivision  of  section  second  of  Article  fourth  expressly  applicable 
to  corporations  as  well  as  citizens. 

The  Insurance  legislation  of  New  York  carefully  discriminat.s  betwee 
the  companies  of  oth(;r  States  and  those  of  foreign  countries,  never  desij 
nating  the  former  as  "/«/•//>«"  corporations.  Such  a  designation,  intrwoven 
into  the  statutes  of  so  many  of  our  sister  States,  is  disloyal  in  its  tendencies, 
malign  and  pernicious  in  its  influence  on  judical  decisions  and  State 
legislation.  Massachusetts,  which  uses  this  word  as  applicable  to  the 
companies  of  other  States,  appreciating  its  incorrectness,  has  been  drivr^ 
to  the  necessity  of  defining  it  by  a  special  section  of  her  general  Act.  {See 
sec.  7S,  Chap.  ]5(i  of  the  Acts  of  lr<6«.) 

The  relations  of  the  States  of  tlie  American  Union  to  each  other  are  st ' 
generis,  and  without  any  precedent  in  political  history ;  the  laws  of  uatioi 
do  not  therefore,  fully  define  the  extra«»rdinary  obligations  and  comir 
required  by  our  inter-state  relations.  The  cori)orations  of  sister  States  are 
not  "foreign,"  they  may  be  quasi  foreign  or  cxtra-territorial;  but  no 
American  company  should  be  designated  in  the  statute  books  of  any 
American  State  as  ''foreign."  The  word  as  thus  applied  should  be  entirely 
eliminated  from  our  statute  books.  It  is  diametrically  opposed  to  that 
catholic  .spirit  of  brotherhood  and  patriotism  which  inspired  our  revolution- 
ary fathers,  and  which  has  now  bLtn  re-baptized  on  so  many  fields  of 
battle  by  the  connningled  blood  of  all  the  loyal  States. 

In  order  to  give  Insurance  corporations  an  adequate  field  for  legitimate 
future  growth  and  expansion,  tlie  utmost  freedom,  consistent  with  soundness 
and  safety  should  prevail  in  permitting  the  corporations  of  one  State  to 
transact  business  in  any  other  State  of  the  Union.  The  deposit  law  of  the 
State  of  Tennessee  was  passed  on  the  29th  day  of  March,  IHtiO,  a  few 
months  before  her  secession  fr(»m  the  Union;  the  depo.sit8  became  greatly 
depreciated  in  value,  and  the  rebel  State  oflicers  have  also  absccmded  with 
the  stocks.  As  a  preliminary  step  to  citntemplated  secession,  this  disK>yal 
and  unsound  legislation  and  fraud  was  in  entire  harmony  with  the  treach- 
erous plans  and  schemes  of  tljc  Rebels.  Such  laws  are  necessarily  inimical 
to  the  old  Union,  and  that  free  and  unrestricted  commercial  intercourse 
between  the  States,  which  should  alwajs  be  fostered  and  encouraged  by 
every  true  friend  of  the  Republic.  The  business  tratlic  and  social  intercoun 
between  the  States  on  the  sujtpression  of  the  Kebellion,  unless  embarrassed 
by  non-intercourse  laws,  will  exceed  all  former  i)recedent.     The  stream  of 


From  Tha  Insurance  Librai-^ '  Association  o£   Boston 


extortioricate  demands  and  levies  on  American  coi 
improperly  styled  "  foreij 


d  custom  house  official  should  not, 
ivery  State  line,  with 
lies,  incorrectly  and 


1  he  question  on  this  whole  subject  must  sooner  or  later  he  narrowed 
down  to  a  single  inquiry,— that  of  inter-state  Justice  and  Comity  as 
between  the  different  States  of  the  Union.  No  system  founded  on  injustice, 
or  State  cupidity,  or  jealousy,  can  ever  be  permanently  forced  upon  the 
American  people.  We  are  to  constitute  one  vast  consolidated  and  homo- 
""       ''  "  "  '  :eries  of  States,  always  fighting' 

:eneral  Uovernment.  It  will  not  long  be  tolerated  by 
the  people  of  any  State  that  for  the  purpose  of  protecting,  at  their  expense, 
local  and  personal  interests  of  rival  and  competing  corporations,  the  free 
and  honorable  competition  of  the  citizens  and  companies  of  other  States 
should  be  interdicted.  By  giving  all  Insurance  companies  a  fair  field  for 
business  and  competition  through  all  the  States  of  the  Union,  subject, 
liowever,  to  the  most  rigid  system  of  personal  inspection  and  examination, 


and  Annual  Statements  of  their  con 


the  rates  of  p 


Avill  be  kept  down  to  the  lowest  standard  of  safety,  and  those  companies 
which  best  subserve  and  protect  the  public  interests,  wherever  located,  will 
obtain,  as  they  always  should,  the  largest  and  most  extensive  patronage. 
State  Insurance  monopolies  will  always  enhance  premiums  and  lessen 
security  in  any  great  contlagration.  Whatever  may  be  thought  of  Free 
Trade,  as  between  foreign  nations,  th<^re  cannot  surely  be  any  doubt  that 
Free  Trade  from  the  Atlantic  to  the  Pacific  should  be  the  established  rule 
of  Legislative  policy  throughout  the  Eepublic.  The  miner  of  Colorado, 
Nevada  and  California  will  not  and  should  not  leave  his  mines  of  silver  and 
gold,  to  organize  an  Insurance  company  where  the  margin  of  profit  is  small 
and  where  a  score  of  years  is  needed  to  build  up  an  established  and  stead> 
business.  The  jegenerated  cottcn  planter  of  the  Mississippi,  the  Sea 
Islands  and  the  Gulf  States,  when  his  broad  acres  are  blessed  with  the 
whiteness  of  blossoming  beauty,  will  not  leave  the  wealth  and  riches 
spread  out  before  him  with  each  returning  Spring,  for  the  dark  office  of  the 
Underwriter,  where  only  the  sacrifice  and  devotion  of  a  lifetime,  even 
under  favorable  auspices,  can  obtain  a  marked  success  and  prosperity.  It 
is  natural,  and  not  to  be  deprecated,  that  the  older  States,— where  the 
avenues  to  immediate  and  sudden  wealth  are  less  numerous,  and  where 
capital  has  bef-n  accumulating  for  many  years,  and  old  companies  are 
reaping  the  fruits  of  long  experience,- should  assume  a  leading  position  in 
all  departments  of  Underwriting.  This  natural  and  necessary  sequence 
affords  no  just  ground  for  jealousy  or  envy  in  the  younger  States,  or  for 
the  erection  of  Chinese  walls  of  seclusion  and  non-intercourse.  In  the 
fullness  of  time,  if  other  financial  schemes  do  not  afford  superior  induce- 
ments, domestic  and  home  Insurance  companies  will  be  organized  to  the 
full  satisfaction  of  the  people  in  all  the  States;  and  sound  companies  from 
any  State  of  the  Union  are  now  freely  welcomed  and  admitted  into  this 
State,  on  the  same  basis  as  far  as  practicable,  with  our  own  companies. 


a  lU'cessHiv  as  wen  a.s  eon 


m  every  interui* 


'xTUACTS  from  an  ojniuo?^  of  Charle.s  Tracy,  Esq. 

'      'ess  of  Insurance  has  become  an  essential  part  of  the  commerce 

:  uie  several  .States  and  with  foreign  nations,  the  rpgrulation  of  which 

s  to  Congress.    Goods  shipped  by  railroad,  canal,  river,  or  lake 

rt.iiius,  from  the  seaboard  cities  to  all  points  in  the  interior ;  and  produce 

= —  "■' every  part  of  the  country  to  its  markets,  must  cross  many  State 

njn  ,  «ii«  .111  insurance  against  loss  or  damage  by  tire  or  by  the  perils  of  trans- 
'•♦  '-  a  necessary  as  well  as  conunon  precaution  in  the  due  course  of  busl 
.V.C-*,.  ^i  policy  issued  at  New  York  or  at  Chicago  therefore  has  its  performance 
in  every  intermrdiate  State ;  and  if  the  local  laws  and  regulations  in  those 
States,  artecting  the  contract,  ditfer,  the  parties  an*  involved  in  perplexity. 
Ill  order  to  the  best  and  most  etfcctivr  conducting  of  the  wide  inter-state 
commerce  of  this  broad  country,  it  has  become  a  national  necessity  th: 
both  money,  the  grand  agent  of  commerce,  and  insurance,  its  grand  pro- 
tection—each an  essential  i»art  of  conmierce  itself— should  be  regulated  by 
Congress,  and  made  uniform  and  well  guarded  by  national  laws. 

The  first  principles  of  Insurance  require  that  the  soundness  of  the  Ii 
ranee  companies,  in  respect  of  Capital  and  the  fidelity  and  fairness  in 
inanngeinent,  should  bc  secured  by  governmental  action.  The  State 
ts,  assuming  this  duty,  have  proceeded  in  diti'erent  and  ever 
rays  to  accomplish  it ;  but,  as  in  the  case  of  Banking  Institutions, 
the  success  <»f  State  government  in  this  respect  has  not  been  uniform  nor 
tisfactory.  The  time  has  come  ft»r  the  Federal  government  to  take  this 
matter  in  hand,  and  pass  laws  for  the  t^stablishment  of  Insurance  com- 
ics, with  ample  Capital,  uniform  organization  and  systematic  reptnts  of 


ut  ami  ever 


their  conditiiui ;  and  toc<mleruponall  companies  contorming  to  sucn  reipure- 
ments,  a  national  character,  which  may  enalde  tliem  to  issue  policies  in  every 
part  of  the  Inion,  and  to  cover  risks  without  restriction  as  to  their  location. 

The  constitutionality  of  the  prop«».sed  Naitional  Insurance  Law,  when 
enacted  by  Congress,  is  clear.  The  power  of  Congress  to  ngulate  com- 
merce among  the  States  and  with  foreign  nations,  and  to  borrow  numey  on 
the  credit  of  the  Tnited  States,  and  to  protect  and  establish  the  credit  of  the 
national  debt  so  formed,  are  tlu>  foundatitui  of  our  National  Hanking  system  ; 
and  the  exercise  t>f  this  power  in  establishing  a  kindred  National  Iisurance 
system  is  calUd  for  by  the  necessities  of  the  country.  Ours  is  a  great  cor- 
mercial  nation.  The  property  in  stores  and  in  manutact»»ries,  and  moving 
along  our  great  avenues  of  transportation,  represents  the  capital  of  our  im- 
ise  and  rapidly  increasing  trade.  The  provision  for  its  Insurance  is  a 
natter  of  national  concern ;  and  tlie  I'nited  Stat<s  Government,  in  wisely 
'  '•  :  the  business  of  Insurance,  will  strengthen  the  Treabury,  confirm 
the  credit  of  the  public  debt  and  advance  the  general  welfare.  Congress  is 
the  judge  of  what  measures  are  necessary  and  proper  to  effect  these  impor- 
tant ends,  and  when  Congress  shall  adopt  the  plan  of  National  Insurant 
companies  based  on  a  Capital  invested  in  the  public  debt,  the  validity  of  th-. 
}aw  will  be  indisputable.  ClIAliLES  TKACY. 

No.  50  Wall  St.,  New -York.  July  l.rfl,  1?^G.'>. 

This  oi)inion   has   nneivid  the    unqualified   approval   of   Hon.  Calku 
Cu.siiim;  and  others  of  kindred  abilitv. 


ClIAliLES  TKACY 


COMMERCE  DEFINED. 

1.  C03IMERCE— J/i  a  Strict  sense,  Traffic  in  merchandize. 
(BurriWs  Law  Diet.) 

2,  Commerce — Li  a  general  se?ise,  an  interchange  or 
mutual  cliange  of  goods,  wares,  productions  or  property 
of  any  kind,  between  nations  or  individuals,  either  by 
barter  or  by  purchase  and  sale. 

Trade;  traffic. 

Commerce  is  foreign  or  inland.     Foreign  commerce 
one  nation  carries  on  with  another;  inland  commerce,  or  inland  trade,  i 
the  trade  in  the  exchanjre  of  commodities  between  citi: 


'i.    Intercourse    between    individuals,    interchange    of 
work,  business,  civilities  or  amusements  ;  mutual  deal- 
ings in  common  life. 

Active  Commerce  :  The  commerce  in  which  a  nation  carries  its  own 
productions  and  foreign  conunodities  in  its  own  ships,  or  which  is  prosecute^' 
bj  its  own  citizens ;  as  contra-distinguished  from  passive  co 
which  the  productions  of  one  country  are  transported  by  the  people  of 
another  country. 

The    commerce   of   Great    Britain    is    active;    and    that  of   China    is 
passive.     {Webster) 


4.  Commerce — In  a  critical  sense  ;  from  con  and  merx, 
ies  a  nuitual  selling  or  traffic ;  and,  in  ordinary  i     ^ 

actical  acceptation,  it  means  trade,  bargain,  s; 
exchange,  barter — embracing  these  both  as  its  means  and 
objects.  (Opinion  Daniel  J.  T.  How.,  U.  S.  Supreme  Ct. 
i?.,  .501.) 


CONSTITUTION  AND  INTERPRETATIONS. 


lie  v^ougress  snaii  nave  power  to  regulate  commerce, 
with  foreign  nations,  and  among  the  several  States,  and 
with  the  Indian  Tiibes.  {Const,  U.  S.,  Art.  I,  §  8,  Sub.  3). 

The  word  Commerce,  as  used  an  Art.  1,^8,  Sub.  3,  of 
the  United  States  Constitution,  is  not  limited  to  the  mere 
buying  and  selling  of  merchandize  and  other  commodi- 
ties, but  comprehends  the  entire  commercial   iutercourse 


with  foreign  nations ;  and  among  the  several  States,  it 
includes  navigation,  as  well  as  traffic,  in  its  ordinary  sig- 
nification. The  power  of  regulation  vested  in  Congress 
relates  to  all  these  subjects.  {People  v.  Broohj  4  Denio, 
469). 

Under  the  above  provision  of  the  Constitution,  tlie 
Federal  Government  lias  exclusive  power  to  regulate  the 
external  coninierce  of  the  nation,  and  of  the  respective 
States ;  to  determine  the  terms  and  conditions  upon  which, 
and  to  prescribe  the  regulations  by  which,  the  commodi- 
ties and  products  of  one  State,  should  be  permitted  to  be 
introduced  into  another  ;  or  exports  should  be  made,  from 
State  to  State,  or  through  the  several  territorial  sovereign- 
ties. (4  N,  Y.  Legal  Observer,  1S7). 

The  article  of  Confederation  regulating  coinmen'e  be- 
tween the  States  reads  as  follows  : 

The  better  to  secure  and  perpetuate  mutual  friendship 
and  intercourse  among  the  people  of  the  ditierent  States 
in  this  Union,  the  free  iidiabitants  of  these  States  (pau- 
pers, vagabonds  and  fugitives  from  justice  excepted)  shall 
be  entitled  to  all  privileges  and  imnninities  of  free  citi- 
zens in  the  several  States  ;  and  the  peoph'  of  each  Statp 
shall  have  free  ingress  and  egress  to  and  from  any  othei 
State,  and  shall  <'njoy  therein  all  the  privileges  of  tra«h' 
and  commerce,  subject  to  the  same  duties,  imposition ^ 
and  restrictions,  as  the  inhal)itants  thereof  ji^spectively  ; 
provided  that  siich  restrictions  shall  not  extend  so  far  as 
to  prevent  the  removal  of  property,  imported  into  any 
State  to  any  other  State  of  which  the  owner  is  an  in- 
habitant;  provi(hMl,  also,  that  no  imposition,  duties  or 
restriction,  shall  be  laid  by  any  State  on  the  property  of 
the  United  States,  or  either  of  them.  {Ari\  Coujhl. 
Art.  4.) 

As  the  avowed  object  of  the  framers  of  the  Constitution 
was,  among  other  things,  "  to  form  a  more  perfect  union  " 


of  tlie  states ;  "to  insure  domestic  trafquMy,     „..  

force  which  iDheres  in  this  fourth  Article  of  Confederation, 
is  likewise  embraced  (though  in  a  more  condensed  form) 
in  the  corresponding  article  of  the  Constitution  of  the 
United  States. 

It  provides  that,  *'  The  people  of  each  State  shall  have 
free  ingress  and  egress,  to  and  from  any  other  State,  and 
shall  enjoy  therein  all  the  privileges  of  trade  and  com- 
merce, subject  to  the  same  duties,  impositions  and  restric- 
tions as  the  inhabitants  thereof  respectively. 

Unharmonious  and  conflicting  State  action,  necessitated 
the  adoption  of  this  clause  in  the  Articles  of  Confedera- 
tion, from  which  they  were  afterwards  engrafted  into  the 
present  Constitution  of  the  United  States. 


Hamilton,  in  reference  to  this  point,  says,  *'  The  inter- 
fering and  un-neighborly  regulations  of  some  States,  con- 
trary to  the  true  spirit  of  the  Union,  have  given  fair  cause 
of  complaint  to  others,  and,  if  not  restrained  by  national 
control,  will  become  injurious  impediments  between  the 
different  parts  of  the  confederacy."  {Federalist,  No.  22, 
p.  116.) 

Mr.  Hamilton  further  gives  it  as  his  opinion,  that, 
"from  the  gradual  conflict  of  State  regulations,  citizens  of 
each  would  at  length  come  to  be  treated  in  no  better  light 
than  that  of  foreigners  and  aliens." 


1.  The  provision  of  the  Constitution,  relative  to  the 
regulation  of  commerce  between  the  several  States,  arose 
from  a  condition  of  conflicting  State  enactments,  analag- 
ous  to  the  conflicting  local  laws  now  enacted  by  the  legis- 
latures of  many  of  the  States. 

2.  The  term  commerce,  as  used  in  the  section  of  the  con- 
stitution, giving  to  Congress  the  power  of  its  regulation  : 
"  comprehends  the  entire  commercial  intercourse  with 
foreign  nations,  and  among  the  several  States."  {The 
People  vs.  Brooks,  4  Denio,  469.) 


ii.  The  word  inicrcoursc  has  a  general  signification.  It 
is  defined  by  Webster  as  "  reciprocal  dealings  between 
persons  or  nations,  by  an  interchange  of  connnodities,  by 
purchase  and  sale,  by  treaties,  by  contracts,  &c." 


an  nisurancocon>oi 


by  which  the  safety  of  goods  and  commodities  that  givt; 
rise  to  connnerce,  is  assured  to  the  ow^ner,  and  indemnity 
promised  in  case  of  loss,  either  while  in  transit  fnun  State 
to  State,  or  while  stationary,  is  as  properly  included  under 
the  power  of  Congress  to  regulate  intercourse  between 
the  several  States,  as  is  the  contract  for  the  purchase  or 
sale  of  such  conunodity,  <u*  for  its  transportation  from  one 
point  to  an(»tlnM'  included  in  the  said  power. 

').  "  This  power,  like  all  others  vested  in  Congress,  is 
complete  in  itself,  may  be  exercised  to  its  utmost  extent, 
and  acknowledges  no  limitations  other  than  are  presented 
in  the  constituti<Mi."  (Gibhons  vs.  Og(hn,  9  Wheaton,  19().) 

().  "  The  pow^M-  to  regulate  commerre  extends  to  every 
species  of  coimnerciul  intenMUirsc  annuig  the  several 
States."     (0  IVheutnn,  J  D.) 


7.  "It  does  not  stop  at  the  jurisdictional  lines  of  the 
several  States,  but  must  be  exercised  wherever  the  subject 
exists."     (0  Jr/teufoN,  19  4,  19»j.) 


8.  *'  A  State  has  no  power  to  declare  what  should  be 
an  article  of  lawful  connnerc  under  the  provision  of  the 
United  States  Constitution. 

*'  The  power  of  Congress  to  regulate  comuierce  is  sub- 
ject to  no  such  limitati(ui."  (Oiii/iion,  Catron,  J.,  -'> 
How.,  -)44.) 

♦).  "Hence  the  jurisdictimi  of  Congress  over  the  entire 
subject  is  unlimited,  and  the  power  of  Congress  to  contnd 
all  cases  included  under  connnercial  interests  unlimited." 


Extracts  from  the  Argument  of  William  Curtis  Notes; 
(The  Fire  Departmetit  v.  Wright,  3  E.  I).  Smith's 
R„  464.) 

(1.)  A  domestic  corporation,  credited  to  carry  on  the  business  of  insu- 
rance, is  a  citizen  of  this  State;  entitled  as  such  to  all  the  rights  of  such  a 
citizen,  which  from  the  character  of  its  existence,  as  an  artificial  being, 
relate  entirely  to  its  franchises  and  property.  (Louisville  R.  R.  Co.  v  Ut- 
son,  2  How.  U.  S.  R.,  497);  {Conroe  v.  National  Protection  Insurance  Co., 
10  How.  Pr.  R.,  403.) 

(2.)  As  such  citizen,  and  in  respect  of  its  franchises  and  property,  it  is 
also  a  person,  and  as  such  entitled  to  all  the  rights  of  such  a  person.  (2  R.  5., 
703,  $  35)  ;  People  v.  Utica  Ins.  Co.,  15  J.  /?.,  358.) 

(3.)  They  are  also  inhabitants  of  the  State  under  whose  laws  they  are 
created,  and  in  which  they  have  their  office  and  carry  on  their  business. 
(Ontario  Bank  v.  Bunnell,  10  fVend.,  186.) 

(4.)  As  the  owner  of  its  property,  such  a  corporation  is  entitled  to  the 
same  protection  as  any  individual  citizen ;  and  its  private  property  can 
only  be  taken  for  public  or  private  use,  in.the  same  manner,  and  under  the 
same  circumstances,  as  the  private  property  of  an  individual.  ( The  Bellona 
Case,  3  Bland,  451-2.) 

(5.)  Private  property  «,hall  not  be  taken  for  public  use,  without  just  com- 
pensation.   (Amendments  Const.  U.  S.,  Art.  5.) 

(6.)  The  Citizens  of  each  State  shall  be  entitled  to  all  the  privileges  and 
immunities  of  the  citizens  of  the  several  States.  (Const.  U.  S.,  Sec.  2, 
Art.  3.) 

(7.)  A  corporation  of  a  sister  State  has  precisely  the  same  rights  as  those 
above  enumerated,  in  the  State  which  created  it,  and  where  it  transacts  its 
business. 


(8.)  The  Const 
created  by  the  se\ 
where  they  transa^ 
519,588.) 


ution  of  the  United  States  recognizes  corporations 
ral  States,  as  citizens  and  persons  in  all  other  States, 
business.  (Cases  under  point  VH.,  Suh.  1,  13  Peters, 


i,J.;  It  tollows,  therefore,  that  under  the  foregoing  clause  of  the  Constitu- 
tion of  the  United  States,  a  corporation  created  by,  and  being  a  citizen  of 
one  State,  is  entitled  in  each  State,  to  all  the  "privileges  and  immunities  " 
of  similar  citizens  of  that  State.  If  this  clause  protects  a  natural  person, 
who  is  a  citizen,  it  also  protects  an  artlHcial  person,  Avho  is  also  a  citizen, 
^nder  the  Constitution ;  so  that  one  State  should  not  put  its  own  artificial 
citizens  upon  any  better  footing  than  a  like  citizen  of  another  State,  or 
make  any  unjust  discrimination  between  them  to  the  prejudice  of  such 


of  similar  citizens  of  that  State.     If  this 

who  is  a  citizen,  it  also  protects  an  artifi 

nder  the  Constitution  ;  so  that  one  State 


NEW  YORK  LAW. 

Where  the  term  person,  or  jiersons  is  used,  in  sections 
18  and  20,  of  title  2,  chapter  13,  of  the  first  part  of  the 
revised  statutes,  and  in  sections  5,  6,  and  7,  of  chapter 
176  of  the  laws  of  18-31,  such  term  shall  be  construed  to 
include  corporations,  as  well  as  individuals.  (Laws  of  New 
York,  1857,  chap.  536,  §  3). 

These  sections  relate  to  the  correction  of  the  assessment 
rolls,  corporations  being,  in  this  instance,  persons  and 
citizens  by  State  enactment. 


ON  TAXING  PREMIUMS  OF  INSURANCE. 

OPINION  OF  JUDGE  SKINNER. 

I  am  asked  whether  the  6th,  7th,  8th  and  9th  Sections  of  the  Act  to 
incorporate  "The  Firemen's  Benevolent  Association  of  the  City  of  Chi- 
cago,"  passed  June  ilst,  1KV2,  are  constitutional  and  binding. 

Our  State  Constitution  contains  a  provision  common  to  aU  the  &taie 

onstitutions  of  our  sister  States,  that  *'  no  freeman  shall  in  any  manner  be 

deprived  of  his  life,  liberty  or  property,  but  by  the  judgment  of  his  peers,  or 

the  law  of  the  land."  ,      ,.    ,.    *  i 

The  meaning  and  effect  of  this  provision  has  been  frequently  adjudicated 

„d  is  now  thoroughly  understood.    So  far  a.,  it  relates  to  the  right  of 

rty,  it  absolutely  prohibits  the  legislature  from  passing  any  laws,  the 

.ncct  of  which  would  be  to  dispossess  any  man  of  any  portion  of  h.s 

V  _  .1. „,.i...  ..o,.«;,-.wl  f.ir  nnblic  mirnoscs,  or 


in  the  administration  of  justi< 
power  of  the  le 

appropriate  the  private  property  of  individ- 
by  forcible  seizure  or  by  taxation,  is  limit* 

The  clause  above  quoted,  whilst  contemplatinj 
the  passage  of  such  laws  as  may  be  necessary  for  the  due  administration  ot 
iustice,  etlectually  inhibits  the  legislature  from  passing  any  laws  which 
would  have  the  eff.ct  to  deprive  any  person  of  any  portion  ot  his  property 
in  any  case,  or  for  any  purpose  not  warranted  by  other  clauses  of  the  Con- 

^  a'  Tareful  examination  of  the  Constitution  shows  that  the  legislature 
cannot  pass  laws  whereby  a  man  may  be  deprived  of  any  portion  ot  his 
property,  excepting  as  ft>llows: 

Jst.  Laws  authorizing  the  appropriation  of  any  specific  portion  ot  a  man's 
property  for  p»Wrc  purposes,  but  for  no  other,  upon  ti.st  making  him  due 
and  just  compensation  therefor. 


COPY   OF   A   LETTER   FROM    THE   HON.   DANIEL    WEBSTER. 


)er  to  nave  jriveu  swc 


Washington,  April  V,\,  1847. 
I  have  your  letter  of  the  Kith  instant. 

member  to  have  given  such  an  opinion  as  you  speak  of,  but  have  no 
sre,  nor  have  I  now  either  the  time  or  the  means  of  drawing  i'" 
another  opinion  on  the  subject. 

I  remember  that  my  opinion  was  a  good  deal  founded  on  or  strent  „._, 
by  a  judgment  of  Mr.  Justice  Washington,  in  the  Circuit  Court  of  Ph..„- 
delphia.    The  (juestion  never  appeared  to  me  doubtful. 

It  may,  perhaps,  be  conceded  that  since  corporations  are  artificial  bein  „, 
atures  of  State  Statutes  and  not  "citizens,"  a  State  may,  if  it  so 
^  iase,  refuse  to  such  corporations,  when  created  by  the  law  of  another 
State,  a  right  to  sue'in  its  courts,  but  this  would  be  going  very  far.  But  to 
tax  business  transactions  allowed  to  be  conducted  in  the  State  when  per- 
formed by  the  citizens  of  other  States,  while  such  transactions  are  ui 

when  occurring  between  those  who  are  citizens  of  the  State  itself,  always 
led  to  me  against  the  constitutional  provision.     Citizens  of  Pennsvl- 
vania  or  Massachusetts  are  found  in  New  York  engaged  in  merca 
transactions,  either  among  themselves  or  with  citizens  of  New  York,  i 

sceiving  promissory  notes  and  bills  of  exchange.     Could  the  L(^ 

ture  of  New  York  lay  a  stamp  tax  on  such  bills  and  notes,  no  such  tax  beinc 
1  generally  upon  all  bills  and  notes  ?     Allow  me  to  say  th. 
I  my  power  to  comply  with  your  request,  either  by  furnishing  i 
of  the  opinion  referred  to,  or  by  drawing  a  new  one  with  a  short  state 
of  reasons  and  references  to  authorities,  I  should  hardly  make  it  m 
then  the  occasion  was  public,  and  the  opinion  requested  o 
the  purpose  of  suggestions  to  those  who  have  duties  to  perform. 

Signed,  DANIEL  WEBSTER. 


OPINION   OF    CHIEF 


I  have  perused  the  opinions  of  Mr.  Webster  and  Mr.  Wood  on 
ject  to  which  tliey  relate,  and  I  concur  with  them  in  opinion,  t 
upon  any  lawful  business  within  the  State,  when  carried  on  by  c 
t)ther  States,  when  such  transactions  are  untaxed  while  carried  on 
re  citizens  of  this  State,  is  unconstitutional ;  and  that  the  a 
Legislature  imposing  upon  individuals  or  associations  not  iucorpc 
the  laws  of  the  State,  though  incorporated  in  any  other  State,  a  ta 
per  cent,  on  the  amount  of  premiums  for  eflfecting  insurance,  c 
constitutional.  The  right  of  the  Legislature  to  impose  such  a  t 
such  a  business  operation,  is  not  questioned,  provided  the  tax  so 
be  general,  and  proportionally- equal  ui)on  all  persons  who  are  en 
isiness  transactions.  The  Legislature  may,  for  purposes  of 
select  such  subjects  for  taxation  as  they  may  deem  most  suitable 
calculated  to  etfect  the  object,  with  the  least  inconvenience  to  and 


the  sub- 
lat  a  tax 


X  of  two 
annot  be 


tax  ou  property  lu  any  urancn  oi  oi 
frrouud  of  discrimination  bet 
of  any  sister  State,  and  thai 


lust  all  be  placed  on  the  same  footinj 

Tlie  same  rule  appears  to  me  to  apply  to  corporations.    A  corporation  coi 

posed  of  citizens  of  a  sister  State  engaged  in  the  business  of  insurance  in 

this  State,  can  be  subjected  to  the  same  tax  only  as  shall  be  imposed  on  a 

corporate  body  created  by  the  Legislature  of  our  own  State.     The  citizens 

of  a  sister  State  do  not  lose  the  constitutional  right  to  the  same  privileges  in 

their  lawful  occupations  and  business  pursuits  in  this  State  with  our  own 

citizens,  merely  because  they  ar 

capacity.  ; 

*^  Signed,  SAMUEL  JONKS. 

New  York,  February  S,  l^r*(t. 


The  following  is  claimed  as  the  pioneer  article  on  the 
subject  of  National  Insurance : 

from  the  Wall  Street  Undencriter,  November  30,  l-'W. 

UNITED  STATES  AND  NATIONAL  INSURANCE  COMPANIES. 

"When  in  the  course  of  human  events"  improvements  are  necessary 
they  are  accomplished. 

The  successful  establishment  of  the  National  Banks,  founded  on  United 
States  Securities,  has  given  rise  to  the  question  "  Why  not  have  National 
Insurance  Companies  also  ?"  This  (piestion  cannot  be  answered  either  yes 
or  no,  without  some  serious,  anxious  rctiection.  Upon  the  very  threshold 
of  the  incpiiry  falls  the  broad  shadow  of  a  pussiant  body  called  "States 
Kights."  How  would  such  a  scheme  interfere  with  State  Rights  7  It 
would  confer  upon  corporations  created  by  Congress,  the  right  to  transact 
insurance  business  in  every  state  and  territory  of  the  Union,  free  from  let 
or  liindrance  at  tho  hands  of  any  state  or  local  authority,  without  charter 
or  license  from  any  local  power,  and  free  from  all  local  taxes  or  impositions. 
This  would  simplify  and  facilitate  the  transaction  of  insurance  business 
throughout  the  country.  Bat  it  would  unquestionably  so  far  iut.rfere  with 
the  rights  or  privileges  hitherto  exercised  by  each  state  as  to  in  a  measure 
supersede  them  by  the  exercise  of  a  power  paramount.  Yet  it  would  not, 
could  not  preclude  any  state  or  territory  from  exercising  the  same  power  m 
a  collateral  degree  within  its  own  jurisdiction.  State  legislatures  could 
still  charter  insurance  companies  for  local  business,  being  in  tact  all  that 
any  state  could  ever  do.  Congress  could  confer  the  additional  power  on  all 
state  companies  upon  certain  conditions  of  operating  throughout  the  entire 
Union.  At  present  it  is  on  the  constitutional  ground  that  United  States 
citizens  shall  enjoy  all  their  privileges  and  immunities  in  common  without 
any  territorial  limit  that  the  companies  of  one  state  carry  on  business  m 
another  state.  If  any  state  should  pass  unconstitutional  prohibitory  laws 
in  this  regard,  it  is  in  the  power  of  Congress  or  of  the  United  States  Su- 
preme  Court  as  the  executive  agent  of  Congress  to  abrogate  such  laws. 

o 


The  power  to  regulate  trade  and  commerce  as  between  the  several  states 
being  vested  in  Congress,  cannot  that  power  be  exercised  to  regulate  the 
business  of  insurance  which  is  merely  a  department  or  auxiliary  of  com- 
merce,  as  between  the  several  states  ?  This  could  be  effected  by  empower- 
ing all  the  companies  now  organized,  or  hereafter  to  be  organized  in  the 


several  states,  to  ti 


o-r^ictx  Biaies,  lo  iransaci  Dusmess  throughout  the  Union  upon  the  terms  of 
investing  their  capital  or  one-half  or  three-fourths  of  same  in  United  States 
Securities,  such  portion  to  be  free  from  taxation  and  to  account  annually  to 
a  Central  Insurance  Bureau  to  be  organized  at  Washington.  The  material 
for  the  organization  of  such  a  National  Bureau  is  ready  to  hand.  New-York 
and  Massachusetts  could  already  furnish  competent  skilled  chiefs  for  such 
a  Bureau  in  the  persons  of  Mr.  Barnes  and  Mr.  Wright. 

If  this  idea  be  ever  wrought  out  into  practical  form  and  being,  there  will 
be  an  end  to  all  the  inconveniences  of  state  deposits,  such  as  that  now  re- 
quired, ($75,000)  in  California  for  instance,  and  Fire,  Life  and  Marine 
Companies  carrying  on  extensive  business  throughout  the  Union,  will  be 
elieved  from  the  offensive  burdens  of  state  and  city  taxes,  and  voluminous 
state  returns  scattered  through  various  portions  of  the  year,  interfering 
vexatiously  with  the  conduct  of  business.  Furthermore  the  expenses  of 
managing  insurance  business  would  be  reduced  so  far  as  relates  to  the  cost 
attending  investments  of  capital  and  assets.  The  title  to  a  United  States 
Bond  is  simplicity  personified  as  compared  with  a  mortgage  on  real-estate. 
Then,  would  the  security  to  the  public  be  at  all  weakened  by  this  plan  ? 
We  cannot  see  that  it  wnnlrl  in  ihn  ci;rri>f<^of  ^^^^r.^      n^  ^i ^ ,i 


vve  cannot  see  that  it  would  in  the  slightest  degree.  On  the  contrary,  the 
means  of  recovering  against  insurance  companies  in  cases  of  litigation  in 
any  part  of  the  country  would  be  made  a  very  simple  process  involving  no 
question  of  local  jurisdiction,  security  for  costs,  or  difficulty  in  discovering 
or  realizing  assets.  In  submitting  this  plan  for  consideration,  we  are  fully 
aware  that  we  are  merely  giving  embodiment  to  ideas  that  have  been  en- 
tertained  for  some  time  by  reflecting  underwriters.  The  subject  affords 
ample  opportunity  for  discussion.  On  another  occasion  we  may  consider 
the  feasibility  of  the  National  Government  granting  annuities  immediate 
or  deferred,  for  money  deposited  with  the  U.  S.  Tieasurv. 


From  the  Insurance  Monitor. 
iTERN  ADVOCACY  OF  A  NATIONAL  INSURANCE  BUREAU. 

ec,  from  your  last  number,  and  from  other  sources,  that  a  movement  is 
smplated  to  obtain  from  Congress  a  National  Insurance  Law.  I  sin- 
y  trust  it  may  succeed— its  benefits  will  redound  mainly  to  the  West, 
so  difficult  to  discern  between  reliable  and  unreliable  companies  as 
come  to  us  here  that  we  need  a  stamp— the  great  broad  seal  of  th(! 
rnment— in  the  foreheads  of  all  candidates  for  public  confidence.  We 
;rn  people  know  that  a  greenback  is  good,  we  also  know-  that  an  east- 
r  western  bank  bill,  not  a  greenback,  may  be  good,  but  we  reject  it  and 
r  the  greenback.  It  will  be  just  so  in  Insurance  as  soon  as  you  nation- 
it.^  If  the  Home  Insurance  Company  of  Cincinnati  can  make  compli- 
with  a  national  law  and  obtain  the  Government  insio-nia,  then  its 


policies  will  be  as  good  as  those  of  the  Home  of  New  York  and  just  as 
popular— not  only  here  but  throup^hout  the  Union.  So  the  Mutual  Life  of 
Wisconsin  may  become  the  peer  of  the  Mutual  Life  of  Xew  York  ;  the  ^tna 
Fire  of  Illinois  the  equal  of  the  iEtna  Fire  of  Hartford,  and  so  on.  It  is  a 
grand  scheme,  and  one  that  the  people  have  a  direct  interest  in.  What  ve 
want  is  security— absolute  prot«'ction  from  any  legitimate,  honorable  source 
that  will  serve  us  best,  and  we  feel  that  "  National "  Insurance  Companies 
wUl  do  the  work  best.  It  is  impossible  for  the  Insurance  companies  of  any 
one  section  to  do  the  whole  business  of  that  section,  and  in  no  place  is  that 
more  sensibly  felt  than  in  your  city  of  New  York  where  you  have  moro 
local  companies  and  more  agencies  than  at  any  other  point  in  the  Union. 
Heavy  calls  have  recently  been  made  upon  the  companies  of  western  cities 
for  lines,  on  cotton  and  other  merchandise  stored  in  New  York,  but  we  can 
only  issue  policies  from  hen*,  we  cannot  plant  our  agencies  in  New  York 
and  share  the  rich  harvest  there  because  of  the  stringent  local  legislation  of 
that  State.  A  national  law  would  remove  our  disabilities  and  put  us  on  a 
par  with  the  companies  of  the  eastern  States. 

Oh,  that  there  were  a  Webster  in  Congress  to  put  this  measure  through  ! 
le  was  ever  the  friend  of  the  West  and  the  friend  of  every  broad  compre- 
hensive measure  that  embraces  the  xrhoh  Union  within  its  arms.  He  would 
have  demonstrated  the  constitutionality  of  this  project  as  he  did  of  the  other 
great  works  of  internal  improvement,  national  in  their  character,  prominent 
in  his  day.  I  never  read  the  speech  he  made  at  Madison,  Indiana,  in  June, 
1837,  without  renewed  admiration  for  the  broad,  national,  comprehensive 
structure  of  the  man  and  that  sublimr  instrument,  the  CoNSTiTUTiox,  of 
which  he  was  the  great  apostle  and  expounder.  Please  give  place  to  the 
following  extract ;  it  is  pertinent  to  the  subject  in  hand,  and  a  scathing 
rebuke  to  the  narrow,  potty  spirit  that  has  dictated  the  State  legislation  on 
Insurance  here  and  everywhere  throughout  the  Union. 

Speaking  of  the  constitutional  right  of  Congress  to  improve  the  naviga- 
tion of  our  great  internal  rivers,  and  to  constnict  roads  through  the  ditTerent 
States,  he  said :  "  That  they  are  local  in  th»*ir  advantages  is  an  objection 
that  has  been  and  will  be  urged  against  every  measure  of  the  kind.  In  a 
country  so  widely  extended  as  ours,  so  diversified  in  its  intensts and  in  the 
character  of  its  people,  it  is  Impossible  that  the  operation  of  any  measure 
should  effect  all  alike.  Each  has  its  own  peculiar  interest,  wliose  advance- 
ment it  seeks  ;  wo  have  the  sea  coast  and  you  the  noble  river  that  flows  at 
your  feet.  So  it  must  ever  be.  Go  to  the  smallest  Government  in  the 
world,  the  republic  of  San  Marino,  in  Italy,  possessing  a  territory  of  but 
ten  miles  square,  and  you  will  find  its  citizens,  separated  but  by  a  few 
niles,  having  some  interests  which,  on  account  of  local  situation,  are 
separate  and  distinct !  There  is  not  on  the  face  of  the  earth  a  plain  fiv 
miles  in  extent,  whose  inhabitants  are  all  the  same  in  their  pursuits  and 
pleasures.  Some  will  live  near  a  creek,  others  near  a  hill,  which,  when 
ny  measure  is  proposed  for  the  general  benefit,  will  give  rise  to  jarring 
claims  and  opposing  interests.  In  such  cases  it  has  always  appeared  to  me 
that  the  point  to  be  examined  was,  whether  the  principle  was  general.  If 
the  principle  were  general,  although  the  application  might  be  paitiul,  I 
cheerfully  and  zealously  gave  it  my  support.'' 


shall  have  a  National  Insurance  Law  that  will  be  a  blessing  To"  the  "i'/e 
country. 

A  Western  Underwriter. 


From  the  Northwestern  Insurance  Journal,  Chicago,  III. 
THE  NATIONAL  INSUEANCE  LAW. 


The  early  c 
insurants  of  our  Western  States,  solely  as  a 

:ard  it  not  only  as  desii 
throughout  tl 


)rotection :  but  we 


act,  to  aid  the  Government  in  the  ^icat  uuaiiuiai  piou^em  or  m 
tion  of  the  public  debt.    This  feature  of  the  act  should  be  oi  sumcienr 
importance  to  at  once  place  the  matter  before  Congress,  and  we  doubt  not 
that  with  this  view  of  the  law  there  can  be  no  question  as  to  its  immediate 


In  another  column  of  the  . 
es  to  be  j 
Life  and  Fi: 

ice  Companies  will  give  th 
the  measure. 


1  of  the  Journal  wi 


will  be  found  mentioned  other  advau- 
\  the  business  of  Insurance,  both 
t  confidence  that  many  Western  Insu- 
ty  approval  and  manly  endorsement  of 


From  the  Banking  Sf  Insurance  Chronicle,  Chicago.  III. 
NATIONAL  INSURANCE  LAW. 
\vr«  „v£.  «.i.4<q  in  nnfo  ar.  in^voocof^  pubHc  iutcrcst  iu  the  above  measure, 

t'ell  as  by  Insurance  journals.  Whether 
the  law  about  to  come  before  Congress  (a  summary  of  which  we  gave  last 
week)  will  pass,  in  its  present  form,  or  even  at  all,  is  doubtful ;  but  we  may 
look  for  good  results  to  follow  from  the  discussion  of  the  matter,  with,  we 
may  hope,  some  beneficial  effects  upon  State  legislation.  It  is  not  easy  to 
settle  at  once  upon  all  the  details  desirable  in  a  general  law  for  nationaliz- 
ing all  classes  of  Insurance  Companies ;  progress  in  legislation  in  a  matter 
of  so  great  importance,  may  properly  be  slow,  and  should  be  exceedingly 


The  incidental  advantages  to  be  realized  by  creation  of  a  National  In- 
„ „^  T> nany.  The  chief  ones  are,  first,  the  adoption  of  uni- 
form rules  for  the  estimation  of  the  liabilities  and  resources  of  Insurance 
Companies  to  be  employed  as  tests  of  solvency ;  no  Company  being  allowed 
to  transact  further  business,  under  the  National  law,  unless  or  until  its  as- 


sets  are  sufficient  in  proportion  to  its  obligations,  according  to  the  standard 
of  valuation.  Second,  relief  from  arbitrary  and  oppressive  State  legis- 
lation. 

The  many  weighty  reascms  for  the  passage  of  a  National  Insurance  law 
apply  with  especial  force  in  respect  to  Life  Companies.  Fire  Companies 
are,  in  many  senses,  local  institutions ;  some  of  the  most  successful  of  them 
(in  results  to  the  assured)  have  confined  th.-ir  business  within  narrow  U-n\- 
torial  limits.  The  nature  of  Life  Insurance  is  far  diflferent.  The  law  of 
mortality  (without  security  in  which  there  can  be  no  security  in  Life  In- 
surance) requires  for  its  full  and  fair  operation,  a  large  number  of  persons, 
scattered  over  a  wide  extent  of  territory.  (Contrast  the  position  of  a  Com- 
pany, in  a  season  of  cholera,  or  other  pestilence,  having  five  thousand  lives 
insured,  say  in  New  York  and  Philadelphia,  with  that  of  anotlier  Company 
havinc'  the  same  number  insured,  scattered  throughout  the  twenty-two 
States^north  and  east  of,  and  including  Virginia,  Tennessee  and  Missouri.) 
Yet  in  many  instances,  we  see  State  legislation  as  regardless  of  the  nature 
of  Life  Insurance,  which  for  its  own  safety,  needs  a  wide  field,  as  it  is  of  the 
entirely  humane  character  of  the  institution. 

We  will  not  stop  here  to  speak  of  existing  State  legislation— a  subject 
which  demands  a  chapter  by  itself;  but  the  reflection,  how  little  such  legis- 
lation has  accomplished  for  the  security  of  the  assured,  (notably  excepting 
the  State  of  Massachusetts,)  brings  us  to  consider  how  much  will  be  done 
in  this  respect  by  the  establishment  of  a  National  Bureau.  It  is  not  so  well 
known  as  it  should  be,  that  the  ordinary  commercial  tests  of  solvency  have 
little  or  no  applicability  to  Life  Insurance.  The  Companies  are  daily  re. 
ceivin.r  funds,  a  large  portion  of  which  arr  to  be  finally  accounted  for  ^ 
generation  hence.  The  calculation,  as  to  the  amount  of  assets  necessaiyM 
be  on  hand  at  ipresent,  against  these  liabilities,  are  intricate-even  d.th- 
cult.  The  people  at  large  never  can  estimate  these  things  accurately,  but 
the  National  Bureau  will  have  its  standard  of  valuation  established  by  law, 
and  no  Company  will  be  permitted  to  do  business  unless  its  assets  ar.  up  to 
the  standard.  Kvc-ry  insurant  will  then  know  that  the  institution  to  which 
he  confides  the  "  .sacred  legacy  for  his  family,"  is  secure  (so  far  as  wise  pre- 
ventive  and  supervisory  law  can  make  it  so)  in  ability  to  discharge  its  obli- 
gations. 

The  amount  of  Life  Insura.ic-  in  force  in  the  United  States,  probably  ex- 
ceeds $i;UO,.l(M»,(K)0,  ouiwhich  the  sums  annually  received  in  premiums 
nud  interest  exceed  $i2,(..)0.(Mm.  Looking  at  the  immense  magnitude  of 
;tinterests  involved,  we  may  see  how  much  they  ^^-^^^^^^;;^:::^: 
vation,  a  system  of  National  U>gislation.  careful,  well  considered,  far-.eein., 
and  abounding  in  provisions  for  the  security  of  the  assured. 

If  there  could  be  brought  about  united  action  on  the  part  of  those  who 
are  annually  paying  premiums  on  this  .^GU0,0.U.O0i»  of  "-;-;-•  ^^^ 
would,  we  doubt  not,  make  such  an  appeal  to  Congress  a.  -ou Id  e  u 
the  immediate  passage  of  a  National  Law.  In  the  ^,^-"7  ^«^J  ^^"^^^^^^  ^ 
action,  let  us  hope  that  some  member  of  Congress  --^'"f  f  ^«.  .^^ J/  ; 
getic  advocacy  of  the  measure,  and  labor  unceasingly  ui  its  behalt  until  h, 
has  secured  its  enactment. 


From  the  Insurance  Monitor. 

CONSTITUTIONAL  REMEDY  AGAINST  OPPRESSIVE  STATE 
INSURANCE  LAWS. 

^+  V^   i„_  -•-_i A  ..       ,.. 

ley  are  liable  to  assault 

•ters  and  nothing  but  the 

ilness  can  preserve  them  unimpaired.    What 

pprehended  from  so  inno- 

neddling  politicians  contrived 

i  even  preventing  the 


employ  it  as  an  msti 
■  er-commerce  of  the  States, 
riie  fourth  article,  second  section,  of  tl 


itution  of  the  United  States 


s  that  "  The  citizens  of  each  State  shall  he  entitled  to  all  the  privilea. 
numties  of  citizens  in  the  several  States.^^     It  follows  that  anv  citize 


ihe  United  States,  desirous  o 
',  his  house,  o  '  '     '  ' 


lor  and  procurinj 
other  State,  or  even  loreio 
indisputable,  he  is  also  equally 
"-ent,  and  an- '^*"*- '-— ' 
sxiould  at  once  oe  aeciarea  sub\ 


y  privih 


For  the  sake  of  affording  a  prac 


cate,  we  will  suppose  that  i     '  ' 
ranee  from  com       '        ' 
consequence  of  the  oppressive  leo-ii 
appoint  agents  in  it.     The  question  i 
cies  ?    As  a  citizen  of  the  Uj 
apply  for  them  personally,  and  surely 
his  asrent  to  do  this  business  fnr  hi      " 


basing  a  policy  of  insurance  on  his 

d  immunity  "  of  applying 

tion  in  his  own  or  any 

(•ht  to  do  this  in  person  be 

eel  to  do  it  by  letter  or  through  his 

ational  "  privilege  and  immunity," 

unconstitutional  and  void. 

I  of  the  principle  we  advo- 


isin  uesires  policies  of  insu- 
terea  oy  otner  States,  but  which  companies,  in 
islatiou  of  his  own  State,  decline  to 
question  arises,  how  shall  he  obtain  these  poli- 
>  United  States  he  has  the  undoubted  right  to 
and  surely  his  right  to  appoint  another  citizen 
s  for  hi       •  •' 


...o  cvg^^.  .„  „w  t..xo  uuaiiicM,  lor  mm,  is  equally  unquestionable.  If  so,  any 
number  of  citizens  may  appoint  the  same  man  their  agent  for  the  same 
purpose,  and  no  State  law,  contravening  this  constitutional  and  inherent 
right,  can  be  enacted  which  the  United  States  Court  would  regard  for  a 
moment. 

It  accordingly  appears  that  a  plain,  simple,  legal  way,  founded  upon 
general  and  constitutional  principles,  still  remains  open  to  our  insurance 
companies  for  the  continuance  of  their  business  throughout  the  Union,  in 
spite  of  the  adverse  and  vexatious  legislation  of  many  of  the  States.  The 
change  of  method  it  will  necessitate  may,  at  the  outset,  subject  them  to 
temporary  inconvenience,  but  it  will  prove  light  in  comparison  with  the 
evils  and  losses  consequent  upon  a  slavish  compliance  with  unrighteous 
state  requisitions. 

Now  we^propose  a  remedy.  Let  a  consultation  of  the  insurance  companies 
on  this  subject  at  once  be  held,  and  the  right  alternative— an  absolute  refusal  to 
comply  with  unjust  State  exactions— be  promptly  adopted ;  then  let  the  compa- 
nies give  notice  that  they  will  receive  applications  for  insurance  from  citizens  of 
other  States  in  person,  by  letter,  or  through  their  agents. 

This  action  will  fon-ver  rid  them  of  a  burden  which  neither  their  business 
nor  their  charters  will  enable  them  to  sustain.  A  course  so  decisive  and 
resolute  will  at  the  same  time  administer  a  needful  lesson  to  State  leo-isla- 


tures,  and  perhaps  convince  tlieni  that  they  cannot  with  impunity  usuq) 
authority  and  rob  companies  that  liave  always  evinced  a  ready  willingness 
to  pay  a  fair  amount  toward  defraying  the  expenses  of  the  government  of 
any  State  to  which  they  have  extended  their  business. 

We  refer  below  to  the  Insurance  Law  of  Wisconsin,  which  is  a  fair  index 
to  that  of  other  States,  and  should  serve  as  a  warning  to  the  people  tl  " 
is  quite  time  that  they  took  the  matter  into  their  own  hands,  and  reminded 
the  petty  politicians  who  have  transformed  it  into  an  engine  of  extortion 
and  tyranny,  that  they  are  only  our  ser\  ants,  and  that  wc  are  still  the  sov- 
ereigns  of  this  one  and  indivisible  country,  and  must  and  will,  in  spite  of 
them  and  their  unconstitutional  State  laws,  have  free  insurance,  the  cheap- 
est and  the  best  that  can  be  procured. 


WANTED-A  NATIONAL  INSURANCE  BUREAU. 

We  cut  the  subjoined  timely  and  pertinent  remailts  from  a  late  number 
of  the  Traveler's  Record  : 

The  insurance  interest  is  one  of  the  most  important  interests  in  the  coun- 
try,  and  is  rapidly  increasing.  The  ntimber  of  fire,  life,  and  marine  insur- 
ance  companies  is  legion,  and  new  ones  are  chartered  at  every  session  of 
every  State  legislature. 

The  Insurance  laws  of  the  different  States  arc  exceedingly  diverse  and 
oppressive.  While  one  State  is  liberal,  allowing  its  citizens  to  take  their 
own  choice  of  companies,  others  place  unjust  restrictions  upon  all  outside 
companies,  which  either  greatly  embarrass  their  operations  or  virtually 
exclude  them  from  doing  business  there.  Pennsylvania,  till  very  recently, 
required  all  insurance  companies  outside  the  State  to  pay  a  license  of  $im> 
to  $2(K)  for  each  county,  (it  has  65  counties,  and  the  total  license  was 
f6,700forthe  State,)  but  this  demand  has  been  modified  to  $r><io  for  the 
State ;  Wisconsin  requires  a  deposit  of  f  2,5,(K)0  in  "  Stump  Tail "  l$onds  at 
par;  and  Nevada  requires  a  deposit  of  ^.-^CtKM)  in  Bonds  of  that  State. 
Other  lecrlslatures  are  provoked  into  retaliatory  measures,  and  companies 
that  for  vears  have  been  established  and  doing  business  in  certam  states 
suddenly  find  themselves  hampered  with  embarrassing  requirements. 

If  the  plan  of  $25,(»00  and  $ 5(>,(XM)  deposits  in  each  State  is  to  become 
universal,  few  companies  will  have  sufficient  capital  to  make  all  the  deposits 
required,  or  would  find  it  profitable  to  make  them  if  so  disposed.  Ihe 
effect  of  these  unjust  requirements  will  react  upon  the  people,  who  are  the 
parties  mainly  interested  after  all.  All  these  matters  could  be  settled  by  a 
National  Insurance  Bureau. 


From  the  Insurance  Monitor. 
NATIONAL  BUREAU  OF  LIFE  INSUR.VNCE. 

Near  the  close  of  the  last  session  of  the  United  States  Congress,  a  memo- 
rial  was  presented,  bearing  the  signatures  of  many  prominent  persons 
askin-  for  the  establishuient  of  a  National  Bureau  of  Life  Insurance.    Jt 


COPY  OP  OPINION  OF  GEORfiE  WOOD,  ESQ. 


I  have  examined  the  act  in  the  first  Revised  Statutes,  page  714. 

The  third  section  of  that  act  imposes  a  tax  upon  any  individual  or  asso- 
ciation not  incorporated  by  the  laws  of  this  State,  thouf^h  incorporated  in 
any  other  State,  of  ten  per  cent,  on  premiums  for  etfecting  insurances. 
The  desiffn  of  this  act  was  unquestionably  to  prevent  corporations  in  the 


sister  States  frc 
than  by  the  imi 


The  act  of  1847  reduces  the 
pie  is  the  same. 


pei;  cent.  l)ut  the  princi- 


1.     It  is  a  tax  on  business.    The 
'  select 


SUCH  a  tax.  iiiey 
best  fitted  to  bear  i 
he  Lejrislature  ci 


I  think  this  provision  is 
Legislature  no  doubt  ha^ 

such  subjects  for  taxation  as  they  may  deem  best : 
But  I  presume  it  will  not  be  contended  that  the  Legislature  ci 
dious  distinctions  between  individuals  or  classes  in  imposing  a  tax  on  pro- 
perty or  any  branch  of  business-  They  could  not,  for  instance,  enact  that 
merchants  who  should  underwrite,  should  pay  such  a  tax  on  the  amount 
of  their  premiu 


"■  ■  ■         "  :  is  the  taking  of  private  property  for  public  use. 

dividual  taxed  receives  a  just  compensation 

or  equivalent  in  the  protection  he  derives  from  government.     But  if  invidi- 

i,  in  reference  to  the  same  sub- 
]  feel  that  there  is  the  absence 
'.  can  perceive  no  substantial  distinction  betwee 
it  case  to  discriminate  between  corporations  of  this 

indi- 


Cleaiiy,  a  State  Legislature  could  not  impose  unequal  taxes  upon 
citizens,  and  the  citizens  of  other  States  doing  business  in  such  State. 
lUst  all,  in  this  respect,  stand  upon  an  equal  footing, 
'he  same  may  be  said  of  corporations.  The  Legislature  does  not  prohibit 
the  citizens  of  Pennsylvania,  incorporated  under  Pennsylvania  laws  from 
;  the  business  of  insurance  in  this  State.  When  thus  engaged,  such 
Ivania  corporation  is  pursuing  a  lawful  calling.  In  the  pursuit  of 
that  business,  I  think  they  can  be  subjected  only  to  the  same  tax  as  shall 
be  imposed  on  a  New  York  corporation. 

The  citizens  of  a  sister  State  do  not  lose  their  constitutional  rights  to  the 
lent  of  the  same  privileges  with  the  citizens  of  this  State  in  transact- 
•  a  legitimate  business  here,  merely  because  they  are  acting  in  a  corpo- 


Signed,  GEORGE  WOOD, 


New-York,  April  16,  184: 


ments,  and  persons  tliere  enumerated,  excepting  hy  tcny  of  taxes.  Call  it 
license  or  what  you  will,  it  is  still  only  a  tax,  and  must  have  all  the  features 
and  characteristics  of  taxation.  It  must  be  imposed  for  the  public  benefit, 
and  its  proceeds  must  be  applied  for  the  public  good  and  not  for  any  private 
benefit.  The  bado^es  which  distinguish  a  valid  tax,  even  though  it  be  called 
a  license,  are,  that  it  is  uniform,  equal,  and  that  the  proceeds  go  into  the 
public  treasury.  That  treasury  may  be  the  State,  County  or  Town ;  but 
still  it  is  the  public  treasury,  and  the  money  must  go  into  them,  and,  osten- 
sibly at  least,  for  the  public  benefit.  The  license  must  be  uniform — that  is, 
alike  in  its  character  and  equally  imperative  on  all  of  the  particular  class  of 
persons  pursuing  the  calling  to  be  licensed.  It  mu.st  be  equal  in  its  burthen, 
though  that  equality  may  be  per  capita,  or  a  per  centage;  and  in  all 
cases  the  money  received  must  go  into  the  public  treasury  for  public 
purposes. 

The  decision  in  the  case  of  The  People  vs.  Philip  Thurber,  VMh  Illinoi.s, 
554,  cannot  be  cited  to  .sustain  the  provisions  of  the  act  in  question.  The, 
License  Law  under  which  that  decision  was  rendered,  was  passed  during 
the  lifetime  of  the  old  Constitution,  and  before  the  limitatiim  afterwards 
made  in  the  2d  Section  of  the  9th  Article  of  the  new  Constitution  took 
effict.  The  new  Constitution  kept  the  License  law  alive,  and  therefore  the 
case  was  adjudicated  without  any  reference  to  the  implied  limitation  in  the 
new  Constitution.  And  even  if  it  had  been,  it  would  have  made  no  ditfer- 
ence,  for  that  was  a  case  of  real,  bona  fide  license,  when  the  money  went 
into  the  public  treasury  and  was  raised  equally  and  with  due  regard  to  the 
legitimate  rules  of  taxation. 

It  may  be.  thought  that  this  law  only  effects  the  agents  of  foreign  compa- 
nies, persons,  or  associations.  But  this  is  not  so.  Every  person,  partner- 
ship, or  association,  residing  in  the  State  of  Illinois,  and  even  in  the  City  of 
Chicago,  that  underwrites  through  an  agent  in  the  City  of  Chicago,  and 
insures  property  here  against  loss  or  damage  by  fire,  is  amenable  to  these 
provisions,  if  they  are  constitutional  and  binding.  In  this  way,  private 
persons  are  heavily  taxed  for  doing  a  lawful  business,  while  artificial  per- 
sons  escape.  The  law,  therefore,  is  unequal,  and  does  not  bear  equally 
and  justly  on  the  class  of  persons  within  the  ptirview  of  its  spirit.  This 
fact,  too,  destroys  all  the  pertinency  of  any  argument  that  might  be  at- 
tempted  to  be  predicated  upon  the  right  of  the  State  to  regulate  the  use  and 
-enjoyment  of  franchises  or  j)rivileges  in  this  State  by  foreign  corporations 
or  persons. 

The  provisions  of  the  act  in  question  seem  to  belong  exclusively  and 
solely  to  that  rare  class  of  statutes,  by  which  it  is  attempted  to  benefit  one 
person  at  the  expense  of  another.  If  there  was  ever  a  case  in  which  the 
lescriptive  language  of  the  greatest  of  American  lawyers  could  be  made  to 
►roperly  and  pertinently  apply,  this  is  one,  for  in  truth  and  in  fact,  the  act 
in  question  is  "  a  legislalire  judgment;  an  act  directly  transferring  one  man's 
estate  to  another. '^ 

For  these  reasons,  I  consider  the  law  unconstitutional,  and  therefore 


MARK  SKINNER. 


The  insurance  business  in  the  State  of  Illinois  is  as  legitimate  and  proper 
as  any  other  business  in  whicli  the  citizens  of  the  State  can  embark.     It  is 

open  alike  to  all  persons,  natural  as  well  as  artificial,  im 

corporations.  There  is  no  law  prohibiting  it — there  is  none  that  discount- 
enances it  as  being  a  calling  hostile  or  injurious  to  public  policy.  The 
premium  money  earned  in  its  pursuit  as  absolutely  and  as  justly  belongs  to 
the  person  or  association  earning  and  receiving  it  as  do  tlie  wages  of  labor 
belong  to  the  laborer  that  earns  and  receives  them.  Once  earned,  they 
ivate  property,  and  as  such  are  protected  and  assured  as  perfectly 
as  the  rights  of  property  protect  and  assure  any  private  property  whatsoever 
To  compel  the  owner  to  part  with  any  portion  of  property  so  earned,  excejit 
in  the  same  manner  that  the  owner  of  any  property  le^ '""      " 

any  calling,  however  worthy  or  bono"' ' -"  '     

robbery.     Under  our  Constitution  it  cj 

question,  however,  attempts  to  affect  that  object.  Jt  calls  upon  the  insu- 
fent  to  pay  over  a  considerable  per  centage  of  his  employer's  prop- 
erty, not  as  a  public  and  etjual  tax  levied  on  community  at  large,  or  even  on 
all  persons  of  his  craft,  to  go  into  the  public  treasury  for  the  public  good  ; 
not  in  the  course  of  tlie  administration  of  justice  to  pay  just  debts  or 
■use  a  wrong — but  simply,  nakedly  and  boldly,  as  a«forced  gratuity, 

imv/iii  compensation  or  equivalent,  to  a  private  person  for  ])rivate  benefit, 
x'he  fact  that  the  corporation  is  ostensibly  created  for  a  charitable  piiri»ose, 
of  course  does  not  effect  the  position  in  any  particular.  It  is  in  no  sense  a 
public  coi-poration,  much  less  a  ])olitical  one.  in  the  simse  in  whi(rh  city  and 
town  corporations  are— and  cannot,  therefore,  claim  any  such  rights  or 
powers  as  are  sometimes  granted  to  such  corporations.  It  is  purely  private, 
both  ill  its  constitution  and  the  ends  for  which  it  was  created,  and  all  its 
risrhts  and  powers  therefore  are,  and  must  be,  upon  the  narrowest  and  most 


But  it  may  be  attempted  to  be  argued  that  this  money  so  required  to  be 
paid  is  not  a  tax,  but  is  license  money.  I  have  never  been  able  to  appre- 
hend  the  difference  attempted  to  be  drawn  between  taxes  and  licences,  as 
also  between  taxes  and  special  assessments.  A  tax  on  property  may  be  one 
thing,  and  a  license  to  pursue  a  pjirticular  calling  may  be  a  different  thing; 
but  I  apprehend  it  involves  a  difference  in  name  and  not  in  nature.  In  either 
case  it  is  simply  the  exercise  of  that  power  of  taxation  inherent  in  the  State, 
by  which  the  public  Avrests  from  a  man  a  portion  of  his  private  property 
■'■*hout  compensation,  for  the  purposes  of  supjtorting  the  government. 
The  change  of  name  from  tax  to  license  does  not  change  the  act.  IJut, 
whether  it  does  or  not,  it  is  not  necessary  on  the  present  occasion  to  inquire. 
The  act  in  question  is  not  in  any  sense  whatever  a  license  law.  A  license 
law  comprehends  only  the  idea  of  paying  into  the  public  treasury  for  the 
public  bcmfit  wjiatever  amount  of  money  the  law  may  see  fit  to  j'xact  of  any 
one  pursuing  a  particular  calling.  The  2d  Section  of  the  Uth  Article  of  our 
Constitution  expressly  defines  what  callings,  business  and  persons  may  bn 
specially  taxed,  and  thereby,  according  to  tiie  well-understood  construction 
of  Statutes,  limits  the  callings,  business,  and  persons  that  may  be  so  taxed, 
and  also  the  method  of  taxing  them  By  this  clause,  the  Legislature  is 
restrained  from  imposing  any  other  burthens  upon  the  business,  employ- 


2d.  Laws  providing^  for  the  appropriation  of  the  property  of  individuals 
in  the  course  of  a  due  administration  of  justice. 

'M.  Laws  passed  in  pursuance  of  the  power  of  taxation  vested  in  the 
legislature,  as  limited  and  restricted  by  the  provisions  of  the  Constitution. 

That  the  provisions  of  the  act  in  question  come  under  either  the  first  or 
second  of  these  heads,  will  not  of  course  be  pretended.    It  only  remains, 
therefore,  to  inquire  whether  the  legislature,  under  its  power  of  t 
has  the  constitutional  right  to  pass  such  a  law  as  the  one  under  consideration. 

Without  undertaking  to  define  or  enumerate  what  is  actually  within  the 
legislative  power  of  taxation,  it  is  sufficient  for  the  present  purpose  to  lay 
down  the  clear  and  undisp.ited  principle  that  the  right  to  take  the  private 
property  of  one  person  and  give  it  to  another  private  person  for  his  private 
use,  is  not  within  the  power  of  taxation,  or  any  other  power  possessed  by 
the  legislature.  The  legislature  may  compel  a  man  to  part  with  any  specific 
article  of  property  to  be  appropriated  to  public  purposes,  upon  making  him 
due  compensation.  It  may  compel  him  to  yield  up  his  property  Ibr  the 
payment  of  his  debts,  or  as  a  penalty  for  wrong  doing.  It  may  compel  him 
to  appropriate  a  portion  of  his  estate  in  defraying  his  proportion  of  the 
burthen  of  government ;  l)ut  it  has  no  poucr  to  conqiel  him  to  alienate  any 
portion  of  his  property  to  a  private  person  for  private  uses,  even  though  he 
should  receive  ten-fold  compensation ;— nnich  less  can  it  compel  him  to 
part  with  his  property  for  such  purpose  without  any  conjpensation  what- 


There  is  no  way  in  which  a  law  can  be  disguised,  whether  under  the 
name  of  a  License  law,  Jicrenue  law,  or  how  otherwise,  that  can  effect 
such  an  object  directly  or  indirectly,  or  that  can  baptize  it  into  a  constitu- 
tional and  vital  existence. 

Does  the  act  in  question  attempt  the  accomplishment  «»f  any  such  result ! 
By  the  terms  of  the  first  five  sections  of  the  act  in  <iuestion,  a  private  corpo- 
ration is  created.  It  is  simply  a  private  corporation;  a  purely  private 
artificial  persi>n  created  by  law  for  a  private  purpose,  and  without  one  tra<e 
of  any  thing  of  a  pul)lic  nature  in  its  composition,  and  without  one  public 
duty.  As  such  private  person,  it  has  only  the  bare  naked  rights  of  an  ordi- 
nary private  person,  not  to  the  extent  by  any  means  of  a  natural  person, 
but  only  such  as  arc  allowed  to  it  by  the  bare  letter  of  the  charter  of  its 
existence.  Beyond  this  it  has  nothing.  The  succeeding  sections  of  the  act 
are  the  ones  under  consideration.  By  these  the  legislature  has  attempted 
to  require  that  all  persons  acting  as  agents  of  persons  and  associations  not 
incorporated  by  the  laws  of  the  .State  of  Illinois,  in  the  business  of  effecting 
insurance  against  loss  or  injury  by  fire  in  tlie  city  of  Chicago,  to  pay  over 
to  the  private  corporation  so  created  by  the  preceding  sections  of  the  act, 
two  per  centunj  of  all  premiums  received  by  such  agent,  or  agreed  to  he 
paid  to  hiw  year  by  year.  The  provisions  in  (juestion  have  just  this  extent 
and  no  more;  they  require  certain  private  persons  pursuing  a  lawful  calling 
in  the  city  of  Chicago,  to  give  year  by  year  a  portion  of  their  estate,  without 
compensation  or  ecpiivalent,  to  another  private  person  for  the  private  use 
and  benefit  of  that  person  alone  ;  and  in  addition  thereto,  meanwhile,  puts 
such  persons  under  bonds  in  a  heavy  sum,  that  they  will  so  give  of  their 
estate  in  compliance  with  th(?  terms  of  the  law. 


my  Its  presentation  became  simply  a  matter  of  record,  for 
future  reference  and  action.  We  were  among  the  signers  of  this  memorial ; 
and  our  only  objection  to  it  was  that  it  is  not  broad  enough  to  cover  all 
branches  of  the  Insurance  business— Fire  and  Marine,  as  well  as  Life. 
There  is  no  good  reason  why  the  Insurance  business  of  the  country  should 
not  become  as  national  as  the  business  of  banking.  Tlie  qwestien  of  Union 
is  settled.  Now  let  us  nationalize ;  and  so  do  away  with  all  petty  State 
lines  and  State  laws,  in  financial  and  commercial  transactions.  We  append 
a  copy  of  the  memorial  to  which  we  have  refen-ed  : 

"  We,  the  undersigned,  citizens  of  the  United  States,  respectfully  repre- 
sent that  there  are  now  in  the  Ignited  States,  thirty,  (30,)  or  more  life  insu- 
rance companies  incorporated  by  loyal  States  and  States  in  rebellion. 

"  That  in  order  to  secure  all  the  averages  which  appertain  to  health  and 
longevity,  it  is  necessary  for,  and  the  several  companies  do  issue  policies  of 
life  insurance  in  States  other  than  those  from  whom  thev  receive  their 


"  That  the  people  of  the  United  States  are  constantly  changing  their 
residences,  from  one  State  to  another,  and  are  thereby  subjected  to  embar- 
rassments, by  reason  of  conflicting  State  laws,,  which  to  a  greater  or  less 
extent  prejudice  the  interest  of  persons  insured,  and  their  survivors,  in  the 
collections  of  claims  for  losses. 

"  That  the  rules  and  regulations  of  State  institutions  are  variable,  and 
that  no  standards  have  been,  or  are  likely  to  be,  established,  whereby  the 
solvency  and  perpetuity  of  life  insurance  companies  will  be  secured. 

"  That  at  the  present  time  there  are  very  nearly  or  quite  one  hundred 
thousand  (100,000)  persons  holding  policies  of  life  insurance,  amounting  in 
the  aggregate  to  about  two  hundred  and  seventy  millions  ($270,000,000)  of 
dollars,  towards  the  payment  of  which  the  several  companies  have  accumu 
lated  about  forty  millions  ($40,000,000)  of  dollars,  and  are  receiving  in 
annual  premiums  about  eight  million  five  hundred  thousand  (8,500,000) 
dollars. 

"  That  the  present  is  believed  to  be  a  favorable  time  for  Congress  to  estab- 
lish a  Bureau  of  Life  Insurance,  at  the  seat  of  government,  under  an  act 
which  will  enable  State  institutions  to  become  national  in  their  character, 
receiving  new  charters  from  and  depositing  the  capital  with  the  govern- 
ment, and  exchanging  their  present  policies  for  issues  such  as  shall  be 
authorized  by  the  Comptroller  of  Life  Insurance. 

"  That  in  the  opinion  of  the  undersigned,  such  a  modification  of  the  system 
of  Life  Insurance  would  be  beneficial  to  the  present  life  insurance  com- 
panies, and  the  present  holders  of  their  policies  ;  and  that  the  holding  of 
policies  of  life  insurance,  issued  by  life  insurance  companies  of  a  national 
character,  would  tend  greatly  to  increase  the  interest  of  the  people  in  the 
government,  and  that  the  latter  would  be  strengthened  by  the  concentration 
of  capital,  which  has  been  already  accumulated,  and  which,  under  a  national 
system,  would  increase  with  great  rapidity ;  and  the  blessings  of  life  insu- 
rance would  be  more  generally  distributed  among  the  peoph'. 


"  In  view  of  the  above,  antl  many  other  considerations,  the  undersigned 
petition  Con<^ress  to  consider  the  subject,  and  pass  the  act  hereto  appended, 
with  such  alterations  and  amendments  as  in  your  wisdom  sliall  be  deonud 
icessary.    And,  as  in  duty  bound,  they  will  ever  pray. 
"  Dated,  New-York,  January,  1805. 

C.  r.  Smith,  Brooklyn,  N.  Y. 

Marshall  Jewell,  Hartford,  Conn. 

Jesse  W.  Bexedict,  City  of  New-York. 

P.  C.  Caliioux,  New-York  City. 

J.  Thompson,  New-York  City. 

T.  Jones,  Jr.,  New-York. 

Benjamin  Noyes,  New  Haven,  Conn. 

Edward  A.  Stansbury,  New-York  City. 

Charles  Taylor,  New-York. 

John  B.  Rohertson,  Conn. 

Edward  C.  Mundy,  M.D.,  New-York. 

Joseph  IToxie,  New-York. 

Henry  D.  Walker,  New- York. 

Henry  C.  Bowen,  New-York  Indep't. 

J.  B.  Ecclesine,  New-York  City. 

J.  D.  Mitchell,  Wa.shington,  D.C. 

N.  D.  Sperry,  Connecticut. 

^VM.  M.  ^VHITE,  Connecticut. 


From  the  If  all  Street  Underttriler. 
NATIONAL  INSriJANCE  COMPANIES. 

!Many  months  ago,  in  this  paper,  we  adv«x'atcd  the  establishment  of  a 
National  Bureau  of  Insurance  at  Washington,  to  assimilate  our  Insurance 
Companies  to  the  action  of  the  National  Banks,  and  thus  over-ride  all  the 
unconstitutional  inter-state  prohibitory  laws  which  have  grown  into  fashion 
of  late  years.  More  or  less  were  we  derided  for  our  suggestions  at  that 
time.  "  Insuperable  obstacles  "  were  suggested,  and  we  held  our  peace, 
still  believing  we  were  right.    Now  the  otticers  of  the  several  leading  com- 

nies  in  the  general  agency  line  have  grown  up  to  the  dimensions  of  the 
idea,  and  a  general  movement  is  on  foot  to  memorialize  Congress  to  nation- 
alize our  Insurance  Institutions.  Good !  We  b.ok  on  it  that  the  thing 
will  be  done,  and  hope  to  live  to  see  the  day  when  a  sound  Company  can 
operate  fn.m  Maine  to  California,  without  let  or  hindrance  from  State  limits 
or  jurisdictions.  As  to  hoic  it  shall  be  done,  "  How  to  do  it,"  much  renuiins 
to  be  considered ;  but  the  derails  will  be  worked  out  when  the  principle  is 
settled. 

In  this  connection  we  confess  that  we  have  felt  and  have  published  what 
we  felt,  that  our  leading  companies  were  too  supine  for  many  years  in 
regard  to  the  obno.xious  State  restrictions  now  complained  of.  For  instance, 
the  New  York  and  Hartford  Companies  should  never  have  complied  with 
the  State  deposit  law  of  California,  but  should  have  resisted  it  and  taken 
the  question  up  to  the  I'nited  States  Supreme  Court,  where  we  feel  a  tirm 


nconstitutional  and  void. 
'  prevailed  upon  to  establish  a  National 
Insurance  Bureau,  and  empower  properly  constituted  companies  to  transact 
their  business  all  over  the  country,  greater  results  will  be  reached  than 
could  be  accomplished  by  even  the  most  satisfactory  decision  of  the 
Supreme  Court.  Care  must  be  taken,  in  organizing  the  national  system, 
that  the  individual  characteristics  of  well  established  companies  shall  not 
be  merged  in  the  indiscriminate  plan  of  numeration,  as  in  the  case  of  the 
banks.  Good  companies  will  need  to  preserve  their  nomenclature  as  they 
value  their  individuality.  It  will  answer  well  enough  to  have  the  ^.tna 
National  of  Connecticut,  and  Home  National  of  New  York,  &c.  &c.,  whilst 
it  would  be  subversive  of  all  existing  interests  to  have  the  companies  jum- 
bled up  and  distinguished  only  asjirst,  second  or  third  National  Insurance 
Companies,  &c.  We  expect  there  would  be  Continental  as  well  as  Metro- 
politan  objections  to  such  a  course. 


From  the  Insurance  Monitor. 

INSURANCE  AND  DEPOSIT  LAWS. 

The  truth,  that  the  ability  of  an  insurance  company  to  respond  to  all 
claims  for  losses  that  can  be  made  upon  it,  largely  depends — first,  upon  the 
amount  to  which  it  assumes  risks  within  a  limited  area;  and  secondly, 
upon  the  extent  of  country  over  which  its  business  is  conducted,  is  one 
which  has  not  commonly  been  sufficiently  appreciated. 

Whenever  companies  insure  for  unlimited  and  excessive  amounts,  the 
liappening  of  a  fire  which  burns  over  a  comparatively  small  district,  is 
liable  to  render  it  impossible  for  them  to  pay  the  losses  sustained  under 
their  policies.  If  companies,  whose  business  is  confined  mainly  to  a  single 
city,  assume  such  inordinate  risks,  the  liability  to  failure  on  account  of 
such  a  fire,  is  vastly  greater  than  in  the  case  of  companies  whose  business 
reaches  as  wide  as  the  country  extends,  for,  while  the  annual  receipts  of  the 
former  commonly  range  between  $50,000  and  $100,000  per  annum,  those 
of  the  latter  extend  to  five  or  ten,  or  even  twenty  times  these  amounts, 
and  these  large  annual  receipts  aid  materially  in  paying  excessive  local 
claims.  It  does  not  follow  that  the  company  which  does  the  largest  business 
is  necessarily  the  safest  company.     The  amount  of  capital  has  a  bearing 

ipon  this  question;  but  the  fact  of  greatest  consequence  is  this:  is  the 
Dusiness  prudently  conducted  ?  That  is,  does  the  amount  assumed  within 
limited  districts,  bear  just  proportion  to  the  amount  of  annual  receipts? 
If  all  capitals  were  of  equal  amount,  the  business  conducted  with  uniform 

rudence,  and  the  charges  for  insurance  equal,  it  is  plain  that  the  extent 
of  district  over  which  companies  insure,  would  be  very  nearly  the  measure 
of  the  security  afforded  by  them  respectively.  What  is  called  luck,  either 
good  or  ill,  extends  only  to  limited  districts,  and  for  brief  periods ;  conse- 
quently the  companies  doing  the  widest  business  will,  provided  that  business 
is  done  with  prudence,  find  themselves,  from  the  fact  that  the  aggregate 
average  of  loss  over  an  extended  district  is  not  liable  to  sudden  fluctu- 
ations, be  able   to  pay  the  excessive  losses,  in  a  few  localities,  from  the 


counter-balancing  excessive  profits  of  the  remainder  of  tlieir  field  of  op«ra- 
tions.  The  capital  of  companies  adds  to  the  security  of  policy  holders 
precisely  in  proportion  to  its  amount,  provided  the  measure  of  prudence  is 
perfectly  equal. 

There  are,  also,  other  advantages  to  the  community  in  having  its  insu- 
rance companies  extend  their  business  over  a  wide  district  instead  of  ope- 
rating within  a  more  limited  sphere.  One  of  these  advantages  is,  that  a 
more  extensive  and  thorough  knowledge  of  the  real  cost  of  insurance  is 
obtained,  and  excessive  charges  arising  from  ignorance  are  modified;  and 
another  is,  that  there  are  certain  inevitable  expenses  to  be  incurred  in  con- 
ducting a  business  of  $50,0C0  per  annum,  which  would  not  be  materially 
increased  in  transacting  a  business  of  $1  ,U(M),000  per  annum.  The  expense 
of  conducting  the  fire  insurance  business  of  the  country  is  not  far  from 
:i3J  per  cent,  of  the  premiums  received  ;  in  few  cases  falling  below  25  per 
cent.,  in  many  cases  exceeding  50  per  cent.,  and  now  and  then  running  up 
to  75  per  cent.  It  is  evident  that  each  5  per  cent,  of  reduced  expenses  in 
conducting  the  general  business  is  in  the  end  just  5  per  cent,  advantage 
to  the  community  requiring  insurance. 

The  actual  amount  assumed  by  different  companies  unfortunately  bears 
proportion  neither  to  the  amount  of  their  respective  capitals,  nor  to  the 
extent  of  their  several  businesses.  Amounts  are  taken  on  single  risks 
ranging  from  f5,W(»,  as  th«'  maximum  of  some  companies,  to  over  $300,(MK>, 
as  that  of  others,  and  the  practice  respecting  taking  neighboring  risks 
ranges  just  as  widely,  some  companies  writing  with  unnecessary  caution, 
and  others  with  the  most  unpardonable  and  short-sighted  greediness. 

The  question,  then,  becomes  a  most  important  one,  whether  the  advan- 
tages of  transacting  a  broadly  extended  and  properly  regulated  business 
can  be  secured,  and  whether  such  rash  conduct  on  the  part  of  any  portion 
of  the  companies  as  has  been  referred  to,  can  be  prevented.  The  reply 
must  be  in  the  negative,  if  there  are  to  be  as  many,  or  one-half  as  many, 
different  rules  of  acti<m  for  insurance  companies,  as  there  are,  or  may  be, 
States  in  this  Union.  To-day  no  two  are  precisely  alike.  Some  do  not  at 
all  restrict  their  compmies  as  to  the  amount  to  be  taken  on  a  single  risk  ; 
others  require  special  deposits  for  the  security  of  their  own  citizens,  as  a 
pre-requisite  to  the  establishment  of  agencies  by  companies  of  other  States, 
and  all  require  different  and  often  meaningless  statements  from  the  com- 

panics.  . 

The  tendencv  of  a  deposit  system  is  to  enhance  the  cost  of  insurance  to 
the  inhabitants  of  the  States  requiring  deposit.  Competition  is  diminished, 
and  it  is  an  inflexible  law  of  trade  that  all  impediments  in  its  way  must  be 
paid  for  by  those  who  place  them.  It  is  seldom  that  so  great  a  fallacy  as 
that  originating  this  effort  to  obtain  security  by  special  deposits,  is  made  a 
law.  Whether  the  deposit  be  great  or  small,  it  diminishes  the  ability  of 
the  company  to  meet  the  demands  upon  it  to  exactly.tho  amount  of  the 
deposit  itself.  The  only  exception  to  this  rule  is  in  case  of  a  company 
having  made  a  deposit  with  but  a  single  State.  The  inhabitants  of  that 
State  are  not  at  all  benefited,  nor  are  they  injured  (although  every  customer 
outside  of  that  State  is) ;  but  just  so  soon  as  a  company  has  made  deposits 
in  more  than  a  single  State,  just  so  soon  all  of  its  insured,  including  the 


amount  of  capital 


tes  holding  deposits,  are  injured.     The  best  s 
fiven  by  a  company,  assuming  it  to  be  honestly 

.ving  all  its  assets  under  its  own  control,  and  applicable,  on  the  instant 
to  the  payment  of  claims  upon  it. 

There  are  now  no  fewer  than  six  States  which  requir 
from  five  per  cent,  of  the  annual  premiums  to  i 
result  other  States  constrained  thereto,  are  preparii 
deposits,  or  excluding  from  transacting  business  ^ 
companies  that  have  made  such  deposits  witli  other  States.     The  ac 
will,  no  doubt,  generally  tend  in  the  direction  of  requirinj 
"len,  of  course,  State  will  compete  with  State  as  to  the  amou 
leposit.    Xew  York,  for  instance,  with  its  large  acci 

rrow  districts,  will  insist  upon  having  deposits  so  larj 

Qie  proportion  to  the  largest  deposit  in  any  other  St{ 
Dears  to  the  population  of  such  State.     So  will  Massachusetts,  wit] 
Boston;  Pennsylvania,  with  its  Philadelphia;   Maryland,  with  its  E 
more;  Ohio,  with  its  Cincinnati;  Illinois,  with  its  Chicago;  Louisiana, 
with  its  New  Orleans,  and  other  States  with  g 

and  this  necessary  discrimination  will,  of  course,  excite  again  the  jealousy 
of  States  without  concentration  of  property  in  lar^ 
required  become  so  great  that  companies  will  b 

three  or  four  States  they  will,  do  business  in,  no  existing  amount  of  capital 
being  sufficient  to  comply  with  the  deposit  laws  of  a  greater  number 
of  States.  And  while  this  evil  is  growing,  how  fictitious  is  the  security 
presented  by  the  companies  which,  in  compliance  with  the  requisitions  of 
the  States,  thus  hypothecate  their  assets  ! 

The  States  requiring  deposits  stipulate  that  no  company  shall  withdraw 
its  deposit  until  all  its  risks  in  the  State  have  terminated.  It  is  a  common 
thing  for  risks  to  be  written  for  three  years,  and  even  five  year  policies  are 
not  unusual.  Let  fires  occur  in  New  York  or  St.  Louis,  or  San  Francisco, 
or  in  several  other  cities,  no  larger  than  any  of  these  cities  have  already 
experienced,  and,  with  the  immense  sums  now  frequently  assumed  by  com- 
panies, it  is  not  improbable  that  at  least  fifty  per  cent,  of  the  losses  would 
remain  unpaid  until  the  years  elapse  necessary  to  run  out  the  policies  of 
the  company  losing,  and  release  its  hypothecated  assets  or  such  portion  of 
them  as  might  remain  after  the  payment  of  local  claims.  How  seriou  ' 
eflfect  of  such  a  result  would  be,  can  be  readily  appreciated  when  it  is  recol- 
lected that  when  property  is  destroyed  by  fire,  the  loser,  be  he  a  claimant 
for  loss  of  goods  worth  a  half  million  of  dollars,  or  for  a  dwelling  worth  one 
thousand  dollars,  wants  money  then  as  he  never  wanted  it  before.  The 
prospect  of  getting  it  at  the  end  of  two  or  three  years  is  not  much  better 
.than  that  of  not  getting  it  at  any  time. 

Is  there  no  remedy  for  an  evil  already  great  and  ^  '  •  i   •    i-  '  ^    ■    ' 
a  much  greater  1     None,  unless  the  whole  system  is  changed,     i  ne  tena- 
ency  of  the  action  of  the  several  States  is  all  in  the  contrary  dir    "'         "" 

immediate  interest  of  many  of  the  companies  er ^  '-    -- 

ness,  is  in  favor  of  having  as  many  restrictions  a^  possiDie  placed  in  tue 
way  of  competition.     So  certainly  is  this  the  case  that  it  is  commonly 


^  ...  Yhich  is  liable  to  become 
aioie  system  is  changed.  The  tend- 
s  is  all  in  the  contrary  direction.  The 
mpanies  engaged  in  an  agency  biisi- 
restrictions  a^  possible  placed  in  the 
3  this  the  case  that  it  is  commonlv 


understood  that  many  of  the  restrictions,  imposed  by  States,  cit 


counties  in  the  way  of  deposits,  taxes,  license  fws,  statcimuts,  vVc,  bavo 
originated  with  insurance  companies.  There  is  no  hope  therefore  in  tliis 
direction,  nor  in  any  other,  unless  a  fundamental  change  is  effected,  and 
that  to  such  an  extent,  that  instead  of  having  more  than  a  score  of  different 
leriods  and  forms  of  their  annual  statements,  the  limit  to 
;es,  the  extent  of  capital  required,  the  tax 
lount  of  deposit  exacted  and  the  various 
I'npniinlltlos.  tlip  «»nTnnmues  generally  are  brought  upon  a 
m,  ana  an  are  compelled  to  conduct  business  on  a  uniform 
pian  so  lar  as  us  action  is  concerned. 

Whether  this  can  be  accomplished  or  not  dep<'nds  upon  the  possession 
by  Congress  of  the  right  to  regulate  this  branch  of  Commerce,  and  whether, 
if  the  right  exists,  the  subject  can  obtain  the  consid«>ration  its  vast  impor- 
tance demands.  That  Fire  Insurance  is  an  important  branch  of  conmierce 
needs  no  argument.  The  mere  statement  that  without  Fire  Insurance,  no 
man  not  already  too  wealthy  to  have  any  inducement  to  do  so,  can  pursue 
business,  because  no  one  not  thus  wealthy  can  either  obtain  merchandise 
on  credit  or  afford  to  hold  that  which  he  owns  to  any  large  extent  without 
tire  insurance,  is  at  once  recognized  as  a  fact  and  establishes  it  as  one  of 
the  most  essential  elements  of  commerce. 

Banking  is  often  carried  on  by  individuals.  Marine  Insurance  has  in  an 
inferior  manner  been  prosecuted  in  England  by  individuals,  but  the 
assumption  of  tire  risks  by  individuals  is  a  thing  unknown,  and  from  tho 
nature  of  the  case,  except  by  corporations,  is  impossible.  If  thru,  unless 
by  institutions  created  by  law,  there  can  be  no  Fire  Insurance,  it  is  of  the 
first  importance  that  the  institutions  which  are  created  for  a  business  so 
essential  to  commerce  should  be  regulated  in  the  wisest  manner,  and  they 
should  all,  for  the  same  country  at  least,  be  homogeneous.  Of  «ourse  the 
existing  companies  and  all  such  as  may  hereafter  be  created  by  the  indi- 
vidual States,  should  be  left  to  conduct  their  business  at  homr  as  the 
various  State  laws  will  permit,  while  by  complying  with  such  regulations 
as  Congress  may  prescribe,  they  ought  to  have  the  right  to  pursue  their 
business  wherever  the  authority  of  the  Government  extends.  Judicious 
congressional  action  alone  can  induce  many  of  the  existing  companies  to 
pursue  such  course  as  shall  render  the  holders  of  their  policies  as  safe  as 
they  can  (and  therefore  should)  be  made. 


From  the  Insurance  Monitor. 

THE  HL'REAU  OF  INSURANCE  AT  WASHINGTON. 

The  preamble  to  the  Constitution  of  the  United  States  reads  as  follows : 
"We,  the  people  of  the  I'nited  States,  in  order  to  form  a  more  perfect  union, 
establish  justice,  insure  domestic  tranquility,  provide  for  the  common  de- 
fense, promote  the  general  welfare,  and  secure  the  blessings  of  liberty  to  our- 
selves and  our  posterity,  do  ordain  and  establish  this  Constitution,"  &c. 
and  the  Constitution  in  article  1,  Sec.  8,  when  defining  the  powers  of  Con- 
gress, establishes  its  power  to  legislate  for  the  '^general  ttelfarer'  In  after 
parts  of  the  same  section,  provision  is  made  for  establishing  also  "  uniform 


United  States— also  to 


the  time  and  space  necessary  to  show  ho 

hich  relate  to  the  ''general  welfare''  of  the  peoph 


\y  all,  rich  and  poor,  old  and  young, 
plan,  by  giving  the  preference  uni- 
'  s,  over  that  of  State  banks. 
)  of  its  constitutional  richt  to  do  so. 


legislates  in  regard  to  their  own  compa- 
r  of  the  States  are  now,  and  have  been  for 
md  prescribing  terms  on  which  the  lusu- 
1  shall  be  allowed  to  enter  and  transact 


business  with  their  people;  and  to  insure  the  enforcement  of  these  laws, 
heavy  penalties  are  prescribed. 

Among  the  enactments  of  States  are  found  regulations  as  to  the  a"— •* 
of  capital,  how  it  shall  be  invested,  and  demanding  a  portion  of  it  on 
deposit,  to  be  held  in  trust  for  the  benefit  of  the  people  of  tlie  State  with 
whom  it  is  deposited.  Taxes  are  levied  on  premiums  collected,  and  some- 
times on  capital ;  annual  exhibits— expensive  advertising  of  a  particular 
character;  the  filing  of  charters;  the  entire  schedule  of  all  policies  ever 
issued,  and,  by  annual  additions,  all  subsequently  issued,  whether  to  th.' 
I)eople  of  that  or  of  any  other  State;  full  explanations  as  to  the  manner  in 
which  they  transact  their  business ;  the  manner  of  declaring  dividends, 
and  the  manner  and  time  of  paying  them ;  and  sometimes  votes  and  resolu- 
tions of  the  directors  are  called  for;  attorneys  have  to  be  appointed  on 
whom  processes  of  law  can  be  served  ;  .jnd  a  long  list  of  honorary  fe<"s, 
heavy  State  licenses,  and  other  expenses,  so  that,  to  attempt  to  comply  with 
the  laws  of  a  sufficient  number  of  States  to  secure  the  benefits  of  the  princi- 
ple of  averages  which  apply  to  life,  health,  fires,  and  the  winds  and  the 
waves,  is  to  run  risks  and  hazards  never  contemplated,  including  penalties, 
and,  what  is  worse.  State  officials  who,  having  had  conferred  upcjn  them 
more  or  less  discretionary  powtT,  become  their  own  law  makers,  and  a  sum- 
mary  ejectment  from  the  State  is  likely  to  follow. 

This  annoying  system  of  legislation  by  one  State  bus  led  to  retaliation 
by  others,  until  at  the  present  time,  a  majority  of  the  States,  by  retaliatory 
laws,  have  rendered  it  almost  impracticable  for  Insurance  Companies  to 
continue  tlie  ordinary  transaction  of  their  business.  Indeed  the  evils  now 
experienced  and  the  annoyances  now  put  upon  the  legitimate  business  of 
Insurance  Companies,  far  exceeds  that  tbrmerly  experienced  by  the  people 
in  the  system  of  State  banking. 

In  Life  Insurance  the  present  State  system  produces  an  evil  of  the  most 
monstrous  character;  not  a  single  State  has  ever  attempted  to  establish 
tables  of  mortality  and  expectation  of  life,  or  tlie  rate  of  interest  on  money, 
to  bo  Hsed  in  the  valuing  of  the  policies  issued  by  their  own  Life  Insurance 
Companies  ;  but  they  have  left  it  an  open  question,  so  that  State  officials 
and  the  managers  of  Life  Insurance  Companies  necessarily  come  in  conflict, 
especially  as  the  former  become  laws  unto  themselves,  and  each  company 
is  subjected  to  as  many  kind  of  ordeals  and  standards  as  States  they 
attempt  to  transact  business  in. 

So  far  has  this  conflict  gone,  that  it  is  mcessary  for  Insurance  Com- 
panics  to  employ  an  expert,  either  in  or  out  of  their  offices,  in  order  to  reatl 
wp  year  by  year,  and  to  post  up — movement  by  movement — the  action  of 
States,  or  the  rulings  of  their  Treasurers,  Comptrollers,  Insurance  Commis- 
sioners, Superintendents,  &,c.,  as  the  case  may  be.  Indeed,  it  is  very  diffi- 
cult in  many  States  to  know  who  to  apply  to,  in  order  to  get  all  the  neces- 
sary information,  and  when  and  how  to  perform  all  of  the  requirements  of 
position  or  of  reciprocal  laws— for  thus  far  the  requirements  of  no  two 
States  are  alike  ;  and  the  same  is  true  of  State  officials,  clothed  with  discre- 
tionary power. 

Whenever  special  deposits  of  capital  arc'required  by  sister  States,  such 
deposits  become  special  assignments  of  just  so  nuich  of  the  capital  of  the 


From  Th3  Insurance  Library'  Association  oi'   Boston 


Company,  for  the  exclusive  benefit  of  thv  people  of  the  Stnto  rL., 

and  receiving  it ;  and  it  being  then  beyo 

Company  itself,  is  no  longer  an  available  asset  for  its  ^e 

Such  a  system  of  legislation,  by  the  ^ 
Avill  drive  every  company  into  too  narrow  limits  for  the  laws  of  avera 
apply  upon  their  business,  or  the  companies  must  scatter  and  exhaust 
capitals  in  making  special  State  deposits,  and  thereby  become  entirelv 


deposits— so  that,  as  has  already  been  attempted,  one  St 

legal  effect  of  the  terms  of  any  policy  issued  to  thei 

present  time  an  Insurance  company  doing  business  in  several  States,  is  to 

a  certain  extent,  in  certain  cases,  obliged  to  conduct  its  business  in  as  many 

ditiercnt  ways  as  States  in  which  they  transact  business. 

And  here  we  meet  a  new  difficulty.  Much  of  the  legislation  now  enforced 
by  the  States,  is  pronounced  unconstitutional,  by  such  men  us  Webster,  the 
Hon.  Mark  Skinner,  of  Chicago,  the  Hon.  Geo.  Wood,  and  the  Hon. 
Samuel  Jones,  of  New  York,  and  by  others  representing  the  best  legal 
minds  in  the  country. 


To  settle  these  vexed  questions. 


courts,  would  involve 


he  whole  Insurance  fraternity  in  endless  and  expensive  litigation,  rather 
lian  which  they  submit  to  annoyances  and  wronirs,  which  are  hard  to 


The  people  and  the  Insurance  companies  now  propose  to  have  this  ver; 
injurious  and  perplexing  State  system  exchanged  for  a  National  one,  su 
that  this  conflict  of  laws  shall  be  ended,  with  one  place  for  the  deposit  of 
capital — one  ordeal  to  pass — one  accountability,  and  but  one  accounting 
officer.  This  done,  confidence  in  the  perpetuity  of  our  companies  will  be 
restored,  expenses  will  be  vastly  reduced.  Insurance  premiums  will  be  per- 
manently diminished,  and  the  people  will  hail  the  advent  of  the  system 
with  demonstrations  of  favor,  the  same  as  they  did  the  bills  of  Natiom  ' 


Congress,  in  establishing  a  Bureau  of  Insurance,  at  Washington,  will 
provide,  in  the  enactment,  that  existing  State  companies  may,  as  in  the 
ise  of  State  Banks,  be  turned  over  and  converted  into  National  institu- 
tions;  this  done,  and  such  companies  as  have  made  deposits  with  States, 
will  be  allowed  to  withdraw  them,  and  make  their  deposit  at  the  seat  of 
Government,  in  Government  securities,  registered  and  held  for  the  benefit 
of  all  the  policy  holders  of  the  company,  no  matter  Avhcre  they  may  reside. 
This  change  will  add  to  the  security  of  every  Insurance  i)olicy,  whether  it 
be  Life,  Fire,  or  Marine,  and  the  holder  will  feel  not  only  a  new  interest  ir 
his  policy,  but  in  the  Government  itself— for  his  policy  is  founded  upon  ii 

In  conclusion,  we  venture  to  assert,  that  when  the  time  shall  come  that 
all  the  Bank  bills,  and  all  the  Insurance  policies  held  by  the  people,  are 
National  in  their  character,  and  based  upon  the  debt  of  the  Government,  it 
will  be  universally  admitted  that  Congress  has  done  more  "  to  form  a  more 
terfect  union,  establish  justice,  insure  domestic  tranquillity,  provide  for  the 
common  defense,  promote  the  general  welfare,  and  secure  the  blessings  of 
liberty  to  ourselves  and  our  posterity,"  than  ever  before,  by  mere  legish. 


tion  for  them  ;  every  bank  bill,  and  every  policy  of  Insurance  upon  our 
lives  and  our  property,  representing  as  they  will  thousands  of  niillious  of 
dollars,  and  held  by  citizens  in  every  town  in  the  Union,  will  become  a 
tower  of  strength  to  the  Government  itself. 


NATIONAL  INSURANCE  BUREAU. 

Mr.  A.  D.  Morgan,  the  able  Presid«-'nt  of  the  North  American  Life 
Insurance  Company,  has  written  a  letter  to  Superintend«'nt  Barnes  on  the 
subject  of  the  proper  mode  of  valuing  the  liabilities  and  assets  of  Life 
Insurance  Companies,  wherein  he  dissents  materially  from  Mr.  IJarnts* 
views  on  the  subject.  It  was  our  intention  to  have  published  the  letter,' 
but  want  of  space  will  not  permit  us.  We,  however,  cannot  omit  publishin- 
Mr.  Morgan's  allusion  to  a  National  Insurance  Bureau,  a  subject  which  is 
v  generally  agitated,     lie  says  : 

My  motive  in  thus  addressing  you  has  a  far  more  extended  object,  a 
and  comprehensive  as  are  the  blessings  which  follow  in  the  train  of  a' 
wise  and  extended  adoption  of  the  practice  of  life  insurance.     If  the  State,' 
or,  what  is  better  for  this  purpose,  the  National  Gt)vernment,  is  to  h'gislat. 
on  the  question  of  a  test  as  to  the  solvency  of  our  Life  Insurance  Comjia- 
nies,  I  might  suggest  that  a  commission  be  created  to  investigate  the  vital 
statistics  of  the  country  in  which  the  business  of  the  Companies  is  to  be 
transacted,  and  fix  upon  a  rate  of  interest,  to  which  the  calculations  for  pre- 
miums should  be  adjusted,  with  such  a  measure  of  contingent  loading  r 
would  be  deemed  sufficient  to  meet  expenses  and  other  incidental  charges. 

'his  would  be  all  that  slumld  be  required.  Applying  this  rule  of  cost  to  the 
business  of  every  Company  at  annual  or  other  periodical  sea.sons,  a  certain 
test  would  be  always  at  hand,  and  the  public  would  then,  in  the  reports  ot 
the  Bureau  (which  I  would  liave  at  the  seat  of  the  National  Government). 
have  a  sure  guide  as  to  where  they  could  secure  the  advantages  of  life 
insurance. 

The  reasons  why  I  would  prefer  a  National  Bureau  to  the  present  Stat' 
supervision  are  patent  to  every  otHcer  of  our  present  Companies. 

Life  Insurance,  to  be  successful,  should  not  be  confined  to  one  locality. 
The  business  of  a  Company  should  be  extended  over  as  great  an  extent  of 
territory  as  possible,  in  order  to  equalize,  as  far  as  may  be,  the  rate  of  mor- 
tality among  its  members  in  seasons  of  epidemics.  A  company  doing  an 
extended  business  in  the  city  of  New  York,  and  in  all  the  large  cities  of  the 
United  States,  would  hardly  be  aft'ected  in  case  of  the  plague  raging  in  one 
of  those  cities,  while  the  others  are  exempt;  the  income  from  the  exempt 
district  compensating  for  any  excessive  claims  from  the  infected  one.  It  i 
therefore  important  that  the  largest  liberty  to  transact  btisiness  throughou 
the  whole  country  should  be  accorded  to  our  Life  Insurance  Companies. 

L'nder  the  present  system  of  State  Legislation  it  is  very  ditficiilt  for  our 
Companies  to  so  extend  their  business.  Restriction  after  restriction  i- 
thrown  up  against  the  work  of  the  insurance  agent  throughout  the  lengtli 
and  breadth^of  the  land,  as  though  the  business  involved  some  terribl' 
harm  to  the  public,  instead  of  the  life-giving  stream  of  joy  and  gladne^^ 


that  it  is  to  the  widow  and  the  orphan.  This,  to  enable  the  work  to  go  on  as 
it  should,  and  would  were  matters  different,  should  be  remedied  by  the 
creation  by  Congress  of  an  Insurance  Bureau,  to  which  every  Company  in 
the  country  should  report,  to  enable  it  to  transact  business  outside  of  the 
State  where  located.  The  filing  of  such  report  with  such  deposits  in  the 
Bureau,  as  is  now  demanded  by  our  own  State  laws,  and  with  satisfactory 
evidence  of  solvency  as  the  laws  of  Congress  might  demand,  should  secure 
to  such  reporting  Companies  certificates  of  authority  to  transact  business 
within  any  State  of  the  Union,  without  regard  to  any  State  or  municipal 
laws  whatever. 


From  the  Insurance  Monitor. 


NATIONAL  INSURANCE  DEPARTMENT. 

It  is  a  truism  in  Politics,  that,  as  New  York  goes,  so  goes  the  Union  : 
and,  since  New  York  is  the  financial  heart  of  the  country,  it  is  equally  true 
that  as  this  monetary  heart  beats,  so  throbs  the  pulse  of  the  Republic. 
Hence  it  results  that  the  financial  institutions  of  other  States  are  modelled, 
to  a  great  extent,  on  those  of  New  York.  Nor  do  foreign  countries  fail  to 
jrofit  by  our  example  in  these  particulars.  Our  Insurance  Department, 
for  instance,  has  afforded  a  useful  hint  to  all  communities,  and  has  been 

videly  imitated.  In  view  of  this  fact,  we  think  it  cannot  be  denied  that 
Superintendent  Barnes  has  done  himself  great  credit,  and  the  State  great 
service,  in  this  official  department.  In  the  important,  onerous,  and  very 
responsible  position  of  Superintendent  of  the  Insurance  Department,  he 

las  displayed  an  original,  independent,  and  indefatigable  mind.     He  it  is, 

Iso,  who  has  first  suggested,  in  an  ofiicial  manner,  that  the  Insurance 
business  ought  to  be  made  National.  The  narrow  and  illiberal  California 
Law  has  received,  in  his  last  Report,  a  properly  severe  rebuke.  In  dis- 
cussing this  subject,  he  thus,  for  the  first  time,  officially,  suggests  the  idea 
of  a  National  Insurance  Department : 

"  If  the  system  of  State  deposits  by  Insurance  Companies  is  ever  to 
become  prevalent  in  the  United  States,  such  deposits  should  never  be 
required  to  be  made  except  in  the  State  where  a  company  is  incorporated, 

nless  made  with  the  General  Government  at  Washington,  and  all  deposits 
by  American  companies  should  be  held,  not  for  the  special  protection  of 
policy-holders  residing  in  any  particular  State,  but  for  the  common  benefit 
of  all  American  policy-holders ;  and  all  deposit  laws  should  be  applicable 
to  home  companies  as  well  as  to  those  of  other  States  of  the  Union  " 
Again,  he  pursues  this  idea  with  the  following  pertinent  suggestion  : 
*'  It  is  possible  that  under  the  power  to  regulate  Commerce  among  the 
several  States  (see  Art.  2,  sec.  8,  sitft.  3),  the  right  inheres  in  Congress  to 
prescribe  rules  and  regulations  for  the  governance  of  inter-state  corporate 


of  the  varying  and  dissimilar  req 
These  views  are  followed  up,  i: 
Insurance  Companies  in  the  Wall  Street  Underwriter,  from  which  we  mak< 
the  following  extract : 


"  When  in  the  course  of  human  events  improvements  are  necessary, 
they  are  accomplished." 

"The  successful  establishment  of  the  National  Banks,  founded  on 
United  States  Securities,  has  given  rise  to  the  question,  •  Why  not  have 
National  Insurance  Companies  also  ?'  This  question  cannot  be  answered 
either  yes  or  no,  without  some  serious,  anxious  reflection.  Upon  the  very 
threshold  of  inquiry  falls  the  broad  shadow  of  a  puissant  body  called 
'  States  Rights.'  How  would  such  a  scheme  interfere  with  State  Rights  ! 
It  would  confer  upon  corporations  created  by  Congress,  the  right  to 
transact  insurance  business  in  every  State  and  territory  of  the  I'nion  free 
from  let  or  hindrance  at  the  hands  of  any  State  or  local  authority,  without 
charter  or  license  from  any  local  power,  and  free  from  all  local  taxes  or 
impositions.  This  would  simplify  and  facilitate  the  transaction  of  insu- 
rance business  throughout  the  country.  But  it  would  un«juestionably  so 
far  interfere  with  the  right  of  privileges  hitherto  exercised  by  each  State 
as  to  in  a  measure  supersede  them  by  the  exercise  of  a  power  paramount. 
Yet  it  would  not,  could  not  preclude  any  State  or  territory  from  exercisiug 
the  same  power  in  a  collateral  degree  within  its  own  jurisdictiuu.  State 
legislatures  could  still  charter  insurance  companies  for  local  business,  being 
in  fact  all  that  any  State  could  ever  do.  Congress  could  confer  the  addi- 
tional power  on  all  State  Companies  upon  certain  conditions  of  operating 
throughout  the  entire  Union.  The  power  to  regulate  trade  and  commerce 
as  between  the  several  States  being  vested  in  Congress,  cannot  that  power 
be  exercised  to  regulate  the  business  of  insurance  which  is  merely  a 
department  or  auxiliary  of  Commerce,  as  between  the  several  States  .'  This 
could  be  effected  by  empowering  all  the  companies  now  organized  or  here- 
after to  be  organized  in  the  several  States  to  transact  business  throughout 
the  Union  upon  the  terms  of  investing  their  capital  or  one  haIforthn;e- 
fourths  of  same  in  United  States  Securities,  such  portion  to  be  free  from 
taxation  and  to  account  annually  to  a  Central  Insurance  Bureau  to  be 
organized  at  Washington.  The  material  for  the  organization  of  such  a 
Bureau  is  ready  to  hand.  New  York-  and  Massachusetts  could  already 
furnish  competent  skilled  chiefs  to  such  a  Bureau  in  the  persons  of  Mr. 
Barnes  and  Mr.  Wright." 

This,  it  seems  to  us,  is  somewhat  extreme  doctrine :  and,  much  as  we 
sympathize  with  National  enterprise,  and  all  sorts  of  schemes  that  work  for 
the  National  good,  we  yet  hesitate  to  endorse  this  idea.  Insurance,  in 
most  of  its  aspects  and  its  bearings,  is  local.  Would  it,  then,  be  wise  to 
take  its  management  from  the  State  authorities  ?  A  policy  of  Insurance  is 
a  purchasable  article,  sold  at  the  highest  price  by  the  company,  and 
bought  at  the  lowest  price  by  the  public,  according  to  the  law  which  governs 
in  all  transactions  of  bargain  and  sale.  The  first  necessity  is  soundness 
and  security  in  the  contract.  Mere  insurance  capital,  without  experience 
and  good  management,  is  no  lasting  pledge  of  security  to  the  public. 
A  company  having  .f  1,000,0<M)  capital  may  be  ruined  by  the  conflagrations 
of  a  single  night,  in  consequence  of  its  holding  badly  selected  risks.  The 
need  of  proper  direction  is  self-evident.  Would  such  direction  be  assured 
under  the  supervision  of  the  National  Government,  remote  from  the  com- 
pany's operations,  and  only  animated  by  the  cold  spirit  of  oflScial  routine  .' 


We  think  not.  On  the  contrary,  we  believe  that  failure  would  be  frequent 
under  that  arrangement,  whence  general  distrust  of  Insurance  corporations 
would  rapidly  possess  the  public  mind.  A  single  wild  cat,  one-horse  con- 
cern in  Michigan,  failing,  under  this  system,  would  throw  its  blot  of  ruin 
upon  the  whole  Insurance  brotherhood — upon  the  staunch  old  -(Etnas  of 
Hartford,  equally  with  the  feeble  corporations  of  its  own  Peorian  hamlets. 
In  short,  the  fiiilure  of  a  single  company,  under  this  new  regime,  would 
discredit  the  entire  system  of  National  Insurance  supervision,  and  damage 
the  interests  of  Insurance  everywhere.  Nothing,  surely,  would  be  gained 
by  that.  Nor,  again,  do  we  see  how  the  Natioueal  Government  would  be 
financially  benefited  by  the  organization  of  such  a  department.  Insurance 
companies,  as  we  regard  the  matter,  are  mutual  aid  societies,  combinations 
of  citizens  to  help  each  other.  In  the  very  nature  of  things,  therefore,  they 
are  local  benevolent  associations,  which  should  be  committed  to  the  manage- 
ment of  those  nearest,  and  most  interested  in  their  aftairs.  We  have  always 
urged,  indeed,  that  they  ought  to  have  national  privileges — to  wit,  the 
freedom  of  the  whole  country  for  business  purposes — and  that  all  possible 
safeguards  ought  to  be  thrown  around  them.  But  we  stop  there.  The 
American  people  read  and  think,  and  do  not  need  the  legislation  of  the 
Federal  Congress  for  every  thing.  Left  to  themselves  they  are  wiser  than 
any  body  of  legislators— because  their  hearts  are  in  the  right  place,  and 
their  instincts  go  with  the  truth  and  the  right.  If,  however,  we  are  mis- 
taken, and  a  National  Insurance  Department  is,  indeed,  desirable— as 
tending  to  conserve  Insurance  interests,  and  make  us  more  homogeneous  as 
a  people— we  shall  not  oppose  it.  All  that  benefits  our  country  deserves 
and  will  receive  our  determined  support.  The  plan  of  requiring  each 
Insurance  Company  to  invest  from  one  to  two  hundred  thousand  dollars 
in  United  States  Securities,  in  order  to  obtain  the  right  of  doing  business  in 
each  and  every  State— that  security  being  deposited,  as  National  Insurance 
capital,  with  the  Secretary  of  the  United  States  Treasury— and  to  make  an 
annual  statement  to  that  officer,  might  prove  practically  beneficial,  and  we 
trust  that  Superintendent  Barnes  will  consider  the  subject  at  length,  in  his 
next  report. 


inaurance  Library  Association  of  Boston 


AN    ARGUMENT 


[IRIi'illl  ni? 


SUBMITTED  TO  THE 


INSURANCE    COMPANIES 


By    NATHANIEL    TYLER.     / 


DPiao    G^•I^^TIS. 


NEW    YORK. 


THIS  BOOK  IS  DUE  ON  THELAST  DATE 
STAMPED  BELOW 

AN  INITIAL  FINE  OF  25  CENTS 

OVERDUE. 


5EPni961 


SECDJ=P- 


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THE  UNIVERSITY  OF  CALIFORNIA  UBRARY 


